Neo-Corporatism and Energy Efficiency Regulation

Abstract

Energy efficiency regulations promulgated by the Department of Energy (DOE) since the oil shocks of the 1970’s draw firms and the DOE into long-run relationships. The DOE itself has come to characterize firms as “stakeholders” in “collaborative negotiated rulemaking” processes. The question of how the DOE determines which industries and firms to draw into its regulatory sphere remains outstanding. Further, there is a question of how such regulation affects entry and exit (if at all) from given markets. The research presented here provides some clues. Specifically, the pace of rulemaking appears largely driven by ideology in that it whipsaws from one administration to the next. Further, it is not obvious that “collaborative negotiated rulemaking” generally frustrates entry or promotes exit, but unilateral promulgation of “direct final rules” can induce sharp episodes of exit. These results are consistent less with regulatory capture theory (according to which the regulator acts as an agent of private interests) and more with a concept of neo-Corporatism (according to which private parties act as agents of the regulator). These results derive from examination of data on all “energy efficiency” rulemaking processes filed between 1998 and 2016.