Holding regulators accountable: serving public interest through research

Yet, the popular, economic understanding of regulation ignores many of the benefits for consumers and societal impacts just to make markets run more efficiently.

How are these regulations actually made and enforced? For decades, regulatory experts were seen as the sole decision-makers, with law taking a backseat. For example, the Chevron case, a landmark Supreme Court case in the United States, 40 years ago ruled that regulators should be left to their own devices because they know best and shouldn't be held accountable through law for their decisions. This approach has been influential globally in shaping regulatory practices, including here in Aotearoa New Zealand.

In this Marsden research, Dr Edward Willis challenges this traditional view of regulatory practice and shows that regulation is a form of public power that should be governed by law. By recognizing this connection, we can ensure that regulations are fair, effective, and accountable to the public. This opens new possibilities for improving and transforming our regulatory frameworks which have laws at the heart of how regulators serve the public interest. This approach has gained traction recently, even among the US Supreme Court.

In fact, just this year and in agreement with Dr Willis’s arguments, the US Supreme Court overruled its earlier precedent that supported giving regulators too much power without oversight. The Supreme Court now recognises that regulation should happen within a framework enforced by courts and regulatory agencies working together.

Dr Willis’ research looks at taking similar approach here in Aotearoa New Zealand and other countries. Exploring ways of integrating the principles of law into our understanding of regulation can improve how regulations are made, implemented, and enforced. This includes considering aspects like:

• Why we regulate (intervention)
• Who regulates (institutions)
• How regulations happen (regulatory processes)
• What specific regulations cover (substantive decision-making)
• How regulatory is effective (enforcement actions)
• How we get regulation right (accountability mechanisms)

By balancing flexibility with accountability, governments can develop regulations which are fair, effective, and transparent. This idea may challenge traditional views on regulation, but it aligns with an intuitive understanding: that laws should guide regulators to serve the public interest more effectively.