Search results

The Bureau of Economics in the Federal Trade Commission has a three-part role in the Agency and the strength of its functions changed over time depending on the preferences and ideology of the FTC’s leaders, developments in the field of economics, and the tenor of the times. The over-riding current role is to provide well considered, unbiased economic advice regarding antitrust and consumer protection law enforcement cases to the legal staff and the Commission. The second role, which long ago was primary, is to provide reports on investigations of various industries to the public and public officials. This role was more recently called research or “policy R&D”. A third role is to advocate for competition and markets both domestically and internationally. As a practical matter, the provision of economic advice to the FTC and to the legal staff has required that the economists wear “two hats,” helping the legal staff investigate cases and provide evidence to support law enforcement cases while also providing advice to the legal bureaus and to the Commission on which cases to pursue (thus providing “a second set of eyes” to evaluate cases). There is sometimes a tension in those functions because building a case is not the same as evaluating a case. Economists and the Bureau of Economics have provided such services to the FTC for over 100 years proving that a sub-organization can survive while playing roles that sometimes conflict. Such a life is not, however, always easy or fun.

This paper aims to contribute to the understanding of the mechanisms that evolve during reputational scandals and lead to changes in industry regulation. It explores the processes by which a demand for external industry regulation evolves, also addressing the consequences of firms’ competitive behaviors which lead to substantial misbehavior and the destruction of reputational capital. The authors are interested in whether and how regulatory activities – in the case analyzed here, changes in insurance regulation regarding sales commissions for insurance brokers – are used as a costly, external behavioral control mechanism (third-loop learning) to terminate a reputational scandal that cannot be stopped by internal controls at a firm level (first-loop and second-loop learning) anymore.

The paper explores a real-life case in the German insurance industry that peaked in 2012 and has been well documented by broad media coverage, complemented by interviews with leading industry representatives. Using causal process tracing as a methodology, the authors study the factors in the case that led to an industry scandal. The authors further analyze why the insurance firms involved were not able to limit the scandal’s impact by internally controlling their behaviors, but had to call for external regulation, thus imposing costly restrictions on sales and contract processes. To identify the mechanisms underlying this result, theories from the fields of economics (game theory) and sociology (vicious cycle of bureaucracies), as well as organizational learning theory, are used.

The authors find that individual rationality does not suffice to prevent insurance firms from scandalous business practices, e.g. via implementing appropriate internal behavioral control measures within their organizations. If, as a result, misbehavior leads to reputational scandals, and the destruction of reputational capital spills over to the whole industry, a vicious cycle is set in motion which can be terminated by regulation as an externally enforced control mechanism.

This study is limited to the analysis of a single case study, combining published materials, e.g. broad media coverage, with interviews from representatives of the insurance industry. Nevertheless, the underlying mechanisms that have been identified can be used in other case studies as well.

The paper shows that if firms want to avoid increasing regulation, they must implement strong reputational risk management (RRM) to counteract short-term profit pressure and to avoid restrictive regulation imposed on the industry as a whole. Furthermore, it sheds light on the relevance of spillover effects for RRM, as not only employee behavior within an organization might lead to the destruction of reputational capital but also that from other firms, e.g. from elsewhere within an industry.

The paper contributes by emphasizing a direct causal link between corporate scandals, loss of reputation and regulatory change within the insurance industry. Furthermore, the paper contributes by combining economic theories with organizational theories to understand real-life phenomena.

The aim of this article is to research on forestry green total factor productivity and explore the impact of financial support on forestry green total factor productivity.

The methods used in this study are super efficiency SBM model of undesired output and empirical model. SBM model is a kind of Data Envelopment Analysis (DEA). The SBM model with non-expected outputs (slacks-based measure) can be used to deal with the problem of efficiency measurement with multiple input and output variables and can be used to analyze the efficiency of green development of forestry economy.

First, the overall green total factor productivity of the authors’ country's forestry has shown a trend of first decline and then an increase from 2008 to 2018, and there are significant spatiotemporal differences; second, financial support has a significant positive impact on forestry green total factor productivity; third, environmental regulation has a significant threshold effect in the process of financial support on forestry green total factor productivity, and the role of financial support shows a trend of first increasing and then decreasing.

Secondly, taking the data of 30 provinces and cities in the authors’ country from 2008 to 2018 as the research object, using the super-efficiency SBM-Malmquist index to measure the country's forestry green total factor productivity and analyze its temporal and spatial changes; finally, a dynamic panel model was established to explore the impact of financial support on forestry green total factors quantitative impact on productivity, and adding environmental regulation as a threshold variable to establish a dynamic threshold regression, and found that financial support has a nonlinear impact on forestry green total factor productivity.

Stigler (1971) first presented a theory of regulation in which the regulator eventually serves the interests of the regulated rather than in the interest of the public good. In such an institutional environment, one should expect to observe outcomes associated with reduced competitive pressures on existing firms. The paper aims to discuss this issue.

In this paper, the authors use RegData, which quantifies regulatory restrictions by industry, to determine whether and to what degree regulation reduces establishment entry and the associated job creation and how regulation impacts existing establishment exit and job creation and destruction.

The results, while not definitive, are supportive of Stigler’s theory of regulatory capture.

This paper adds to the small but growing empirical literature examining the effects of cronyism more broadly. Prior studies of regulation have generally been either narrowly focused on a specific regulation or employ less precise measures of the extent of regulation. By employing RegData as a measure of regulatory restrictions by industry, this paper offers new insights on the impact of regulation on business dynamics.

With the increasing use of small unmanned aircrafts (SUAs), many countries have enacted laws and regulations to ensure the safe use of SUAs. However, there is a lack of industry-specific regulations accounting for the unique features of construction-related SUA operations. Operating SUAs in the construction industry is attributed to specific risks and challenges, which should be regulated to maximize the utility of SUAs in construction. This study, therefore, aims to develop a multi-dimensional regulatory framework for using SUAs in the construction industry.

A combination of quantitative and qualitative methods was used to compare seven selected national/regional SUA regulations to identify the applicability of implementing the existing regulations in construction. The interview surveys were then conducted to diagnose the challenges of construction-related SUA operations and gather interviewees' suggestions on the regulatory framework for SUA uses in construction.

The research found that some challenges of construction-related SUAs operations were not addressed in the current regulations. These challenges included the complex and time-consuming SUA operation permit, lack of regulation for special SUA operations in construction, insufficient regulatory compliance monitoring and a lack of construction-related remote pilots' training. A regulatory framework was then developed based on the findings of comparative analysis and interview surveys.

This study mainly compared seven representative countries/regions' regulations, leading to a small sample size. Further research should be carried out to study the SUA regulations in other places, such as South Africa, South America or Middle East countries. Besides, this study's respondents to the interviews were primarily concentrated in Hong Kong, which may cause the interview results to differ from the construction industry in other countries/regions. A large-scale interview survey should be conducted in other places in the future to validate the current findings.

The proposed regulatory framework provides a reference for the policy-makers to formulate appropriate industry-specific SUA regulations and improve the applicability of SUA regulations in the construction industry. It sheds light upon the future of SUA regulations and the development of regulatory practice in this area.

This study is the first to propose a multi-dimensional regulatory framework for operating SUAs in construction by comprehensive policy comparisons and interviews. The regulatory framework offers a fresh insight into the unexplored research area and points out the direction for subsequent studies on SUA regulations in the construction industry.

The purpose of this paper is to test the relationship between environmental regulations and green total factor productivity (GTFP) of China's logistics industry. The high-factor input, high-energy consumption, and high-pollution emissions model of the logistics industry developed within China faces challenges from severe resource and environmental constraints. It is generally believed that environmental regulations effectively restrain pollution emissions and help protect the environment.

The authors employ the undesirable slack-based Malmquist Luenberger model to calculate the GTFP across the provincial logistics industry and use the mediation effect model and threshold effect model to explore the effects and mechanics of environmental transmission regulations on the GTFP.

The main results show significant regional differences in the GTFP of logistics industry across China. In the transmission path of the impact of environmental regulations on the GTFP, regional innovation capabilities have mediation effects. Regional innovation capacities have a masking effect on the transmission path of environmental regulations on accumulated technical efficiency changes (AEC) and accumulated technical changes (ATC). The threshold effect test results show a dual-threshold effect between environmental regulations and the GTFP, with environmental regulations as threshold variable. Furthermore, the impact of regional innovation capability on the GTFP has a dual-threshold effect, with environmental regulation as threshold variable.

First, it is advisable to plan the environmental regulation policy system thoroughly and add supporting measures to ensure the efficiency and smooth implementation of the nation's environmental policies. Second, it is important to further understand the critical role of innovation capability in improving the GTFP. Third, there is an urgent need to standardize the operating behavior and market order of the leading players in the logistics market and to improve the operational efficiency of logistics enterprises.

So far, a systematical study researched on effect of environmental regulation on the GTFP in logistics industry was not published. This study can provide experience for the high-quality development of the logistics industry.

UK Government policy to address perceived market failure in commercial property leasing has largely been pursued through industry self‐regulation. Yet, it is proving difficult to assess whether self‐regulation on leasing has been a “success”, or even to determine how to evaluate this. The purpose of this paper is to provide a framework for this and a clearer understanding of self‐regulation in commercial leasing.

A literature review suggests key criteria to explain the (in)effectiveness of self‐regulation. UK lease codes are analysed in the light of this literature, drawing on previous research carried out by the authors on the operation of these codes.

Lease codes appear to be failing as an effective system of self‐regulation. While there are influential market actors championing them, the fragmentation of the leasing process lessens this influence. The structures are not there to ensure implementation, monitor compliance and record views of affected stakeholders.

This work adds to the literature on self‐regulation in general, and provides an insight into its operation in a previously unexplored industry. Research is needed into the experience of other countries in regulating the property industry by voluntary means.

There are institutional limitations to self‐regulation within the property industry. This has implications for policy makers in considering the advantages and limitation of using a voluntary solution to achieve policy aims within the commercial leasing market.

This paper provides a first step in considering the lease codes in the wider context of industry self‐regulation and is relevant to policy makers and industry bodies.

In this study, the authors examine the relationships between market-based regulations and corporate carbon disclosure and carbon performance. The authors also investigate whether these relationships vary across emission-intensive and non-emission intensive industries.

The study sample consists of the world's 500 largest companies across most major industries over a recent five-year period. Country-specific random effect multiple regression analysis is used to test empirical models that predict relationships between market-based regulations and carbon disclosure and carbon performance.

Results indicate that market-based regulations significantly and positively affect corporate carbon performance. However, market-based regulations do not significantly affect corporate carbon disclosure. This study also finds that the association between regulatory pressures and carbon disclosure and carbon performance varies across emission-intensive and non-emission-intensive industries.

The findings of this study have key implications for policymakers, practitioners and future researchers in terms of understanding the factors that drive businesses to increase their carbon performance and disclosure. The study sample consists of only large firms, and future researchers can undertake similar studies with small and medium-sized firms.

The results of this study are expected to help business managers to identify the benefits of adopting market-based regulations. Regulators can use this study’s results to evaluate if market-based regulations effectively improve corporate carbon performance and disclosure. Furthermore, stakeholders may use this study to evaluate and improve their businesses' reporting of carbon disclosure and performance.

In contrast to current literature that has used command and control regulations as a proxy for regulation, this study uses market-based regulations as a proxy for climate change regulations. In addition, this study uses a more comprehensive measure of carbon disclosure and carbon performance compared to the previous studies. It also uses global multi-sector data from carbon disclosure project (CDP) in contrast to most current studies that use national data from annual reports of sample firms of specific sectors.

The current study seeks to contribute to current self-regulation research by first exploring the association between the cost of self-regulation and firm self-regulation. The mediating role of association membership and firm slack is additionally explored.

Longitudinal analysis of firm-initiated product recalls for 15 manufacturers in the USA automobile industry from 1966 to 2012 has several important findings regarding the motivations for firm self-regulation.

The influence of industry associations and firm absorbed slack both contribute to firm self-regulation.

The current study begins to address the importance of firm characteristics in predicting self-regulation activities. The bulk of existing research has examined self-regulation at the industry level as an activity performed as a result of the adoption of formalized industry sanctioned standards of practice. This research contributes to such work by examining firm proactivity in the absence of such formal standards.

Although there is considerable scholarly research on advertising self‐regulation in the USA, there is no research at all on the unique problems that comparative advertising created for those involved in the industry's self‐regulation. This study aims to address this gap in the literature with an historical analysis of the industry's efforts to respond to the widespread adoption of comparative advertising during the twentieth century.

The study's primary and secondary sources consist of nearly 640 articles collected from historical and contemporary trade journals. The analysis focuses on two research questions: When did calls for the reform and regulation of comparative advertising appear, why did they appear, and who did advertisers believe should be responsible? and Why did advertisers and industry observers believe comparative advertising should be regulated, and what were the consequences of their self‐regulation efforts and initiatives?

The paper finds that industry calls for comparative advertising reform began to appear during the Depression and peaked during the most contentious period of self‐regulation, the 1970s. The findings show that during the 1930s, members of the industry mostly abandoned their efforts to manage what they considered unfair business practices, including explicit comparative advertising, by shaping government policy. The findings also reveal that the issues of disparagement of competitors and the misappropriation of their brand names and trademarks set the stage for an extraordinary conflict between the industry, its self‐regulators, and the Federal Trade Commission.

The findings offer some new and interesting insights into the consequences that can occur when advertisers choose to employ explicit comparative advertising, or what has been called “the hardest sell of all”; the history of advertising self‐regulation in the USA; and the complex relationships among consumerism, political and economic ideology, and industry self‐regulation.