Robert M. La Follette School of Public Affairs
Thursday, July 14, 2016

Yackee’s regulatory capture study draws Sen. Warren’s attention

Yackee’s regulatory capture study draws Sen. Warren’s attention

U.S. Sen. Elizabeth Warren highlighted research by La Follette School Director Susan Yackee and UW-Madison doctoral student Simon Haeder in a recent essay on RegBlog, an online source of regulatory news, analysis, and opinion based at the University of Pennsylvania’s law school. The essay provided several examples of corporate influence on government rule-making, also known as regulatory capture, including their study of the U.S. Office of Information and Regulatory Affairs (OIRA).

“(Yackee and Haeder) found a strong correlation between interest groups lobbying OIRA and changes in the final rules that favored those interest groups,” the senator from Massachusetts wrote in the essay, which was based on her remarks at the Regulatory Capture Forum convened by the Administrative Conference of the United States (ACUS) in March.

Shortly after the ACUS forum, Yackee and two prominent law professors met with Sen. Warren in Washington, DC, to discuss regulatory capture. Every other month, Sen. Warren brings together leading experts on a topic of great interest to inform her and think about ways for addressing the topic or problem, Yackee said.

“She has held these small policy dinners on a variety of topics, and this one was on regulatory capture – the idea that some subset of interests within the regulatory process have captured the decision-making,” she added. Warren’s interest in regulatory capture stems from her efforts on financial regulation, “where it’s more likely to be fewer public interest groups active in that policy space.”

When people think about regulatory capture, Yackee said, they often think about how business has an outsized voice in the making of rules and regulations. This happens for many reasons, including a complex regulatory process that makes it difficult for public participation. Also, public interests often are very diffuse; whereas, business interests are often concentrated, she said.

“It was an amazing exchange of intellectual ideas,” Yackee said about the nearly two-hour meeting. “As the only social scientist in the room, I think I added a lot of value because I was able to clear up some misperceptions based on what we know about data and evidence.”

During their meeting, Yackee told Sen. Warren about her study on health regulation in Wisconsin. “It’s one of the cases I pointed out as a success story,” she said. “In my study, I found that a lot of nurses and doctors participated in the regulatory space independent of business, which could be a foil to problems like regulatory capture.”

Government agency officials are expected to make decisions based on expertise and technocratic information rather than emotional arguments, which may be very compelling to a member of Congress who represents constituencies, Yackee said. “By definition, emotional appeals ought to be less compelling to agency officials,” she added.

Broader scholarship suggests that a battle of intellectual ideas informs policy decision-makers at a much greater rate than one type of voice does, Yackee said.

“When other voices bring technocratic information to the regulatory process, it provides a different lens for thinking about the topic,” she said. “You have a natural foil against a problem like regulatory capture.”