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CRRI Regulatory Capture and Regional Transmission Organizations Performance
May 15, 2008
"Second generation" regulatory capture as an explanatory factor in the performance of regional transmission organizations.
A significant body of public policy and economic literature has developed around the concept of “regulatory capture” ─ a condition in which a governmental regulatory agency created by legislators to serve the interests of the public becomes dominated by incumbent members of the industry it oversees, leading to regulatory decisions and policies that serve the commercial goals of regulated firms rather than those of the intended beneficiaries. The capture analysis provides a useful tool for understanding regulatory agency actions that appear contrary to the policy goals that motivated an agency’s creation.
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