Self-regulation encompasses a wide range of arrangements, from private ordering without resort to legal rules to state-enforced systems of delegated rules. Transaction cost analysis has been used to explain how private ordering emerges, and principal-agency theory to indicate the advantages, but also the difficulties, of state delegation. While public choice theory, as supported by empirical studies, suggests that rent-seeking is inherent in delegated self-regulatory regimes, institutional structures capable of controlling this phenomenon can be envisaged.
Anthony Ogus
Encyclopedia of Law and Economics
1999
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