Tag Archives: regulator capture

Is the nuclear industry suffering from "regulatory capture"?

I was doing a little research on the Nuclear Regulatory Commission when I found the following statement:

“Some observers have criticized the Commission as an example of regulatory capture

Just what does that mean?

In economics, regulatory capture occurs when a state regulatory agency created to act in the public interest instead advances the commercial or special interests that dominate the industry or sector it is charged with regulating. Regulatory capture is a form of government failure, as it can act as an encouragement for large firms to produce negative externalities. The agencies are called “captured agencies”.

via Wikipedia

Sounds eerily similar to what happened with Wall Street and the housing market.

If you’re interested in learning more about how this can happen the NY Times has a great article on regulatory capture:

“The commission’s defenders often argue that it must be cautious because increased costs from safety requirements could kill the nuclear power industry. But the cost of generating electricity from existing plants is actually low: the construction expenses have been paid off and running them is relatively cheap. Requiring the operators of plants to install new safety systems would not result in them being shut down…”

 

Is the nuclear industry suffering from “regulatory capture”?

I was doing a little research on the Nuclear Regulatory Commission when I found the following statement:

“Some observers have criticized the Commission as an example of regulatory capture

Just what does that mean?

In economics, regulatory capture occurs when a state regulatory agency created to act in the public interest instead advances the commercial or special interests that dominate the industry or sector it is charged with regulating. Regulatory capture is a form of government failure, as it can act as an encouragement for large firms to produce negative externalities. The agencies are called “captured agencies”.

via Wikipedia

Sounds eerily similar to what happened with Wall Street and the housing market.

If you’re interested in learning more about how this can happen the NY Times has a great article on regulatory capture:

“The commission’s defenders often argue that it must be cautious because increased costs from safety requirements could kill the nuclear power industry. But the cost of generating electricity from existing plants is actually low: the construction expenses have been paid off and running them is relatively cheap. Requiring the operators of plants to install new safety systems would not result in them being shut down…”