Rules versus discretion: The productivity consequences of flexible regulation

Sumit K. Majumdar, Alfred A. Marcus

Research output: Contribution to journalArticlepeer-review

195 Scopus citations

Abstract

Using data from electric utilities, this study shows that spending on well-designed regulations has a positive productivity impact but that spending on less well-designed regulations has a negative effect. Better-designed regulations are flexible and grant firms latitude on how to meet goals, allow them time to deploy new means to meet goals, and set ambitious goals that stretch them beyond current practices.

Original languageEnglish (US)
Pages (from-to)170-179
Number of pages10
JournalAcademy of Management Journal
Volume44
Issue number1
DOIs
StatePublished - Feb 2001

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