Electing Regulators: The Case of Public Utility Commissioners

Abstract

Governments presumably institute regulatory systems to serve the interests of the public. Sometimes, however, the interests of individual regulators may diverge from those of the public. For example, because regulated industries typically are better organized than the consumers of their products or services, a regulator may maximize his political support by serving the interests of the regulated industry instead of consumer interests. Pluralist commentators on this regulatory dilemma have suggested that subjecting regulators to greater public accountability would reduce the incentives for such behavior. They recommend that, since specialized political interests have less influence over the elective process than over appointments, regulators should be elected rather than appointed.