Towards socio-economic theory and practice of regulation. Evidence from OECD countries and Bangladesh

• Main Author: Goran Sumkoski
• Format: Article
• Language: English
• Published: Taylor & Francis Group 2016-12-01
• Series: Cogent Social Sciences
• Subjects: regulation; social capital; institutions; infrastructure; developing country; oecd
• Online Access: http://dx.doi.org/10.1080/23311886.2016.1254840

This research analyses the impact of social factors on regulation. The institutional theory of regulation introduces additional principles of independence, accountability and transparency of regulatory agencies, however, the paper argues here for further extending the theoretical and practical scope of regulation by introducing additional social aspects such as the notions of participation, inclusion, credibility and ultimately, legitimacy. The theoretical framework is illustrated with an empirical research conducted using the existing infrastructure regulatory indicators for energy, transport and telecommunications developed by OECD and specially reconstructed infrastructure regulatory indicators for Bangladesh for the period of 1975–2013 to exactly mirror the OECD’s infrastructure indicators datasets. The empirical results appear to generally support the theoretical assumptions made in this paper and the argument for broadening the theory and practice of regulation by inclusion of social factors in addition to economic and technical aspects of the traditional theory of regulation. More specifically, the impact on regulation of various social factors such as trust, access to information and absence of corruption, that promote participation, inclusion, sense of ownership and consequently and ultimately legitimacy appear to be statistically significant for both OECD countries and Bangladesh.