The Origins of Utility Regulation and the "Theories of Regulation" Debate

Abstract

In this article, the author attempts to show that the effort to ascribe regulatory effects to a theory largely deflects attention from the dynamic relationships between the regulator and the regulated firm or industry played out most frequently within a long-term relationship closely resembling more familiar forms of long-term contracts. The focus on regulation by commission is misguided and the differences between regulation by commission and by other regulatory techniques are less important than has been appreciated. The author's examination of the history of public utility regulation makes impossible any clear-cut distinction between competing public interest and private interest theories.