Independence, Accountability and Perceived Quality of Regulators

96 Pages Posted: 22 May 2012

See all articles by Chris J. Hanretty

Chris J. Hanretty

European University Institute

Pierre Larouche

Université de Montréal; Center on Regulation in Europe (CERRE)

Andreas P. Reindl

Independent

Date Written: March 6, 2012

Abstract

A specific EU model for national regulatory authorities (NRAs) has evolved in the course of the liberalization processes in network industries (electronic communications, energy and others). It rests on two broad lines: NRAs are independent and accountable.

The CERRE Report on Independence and Accountability of national regulatory authorities (NRAs) provides empirical backing for that model, using a sample of NRAs from three sectors (energy, telecommunications and rail) plus the national competition authorities, and five member states (Belgium, Netherlands, France, Germany and the United Kingdom).

In their report, CERRE researchers compile an index of independence, towards market parties and most importantly towards the legislative and executive powers. They also develop a new index of accountability, comprising the main elements that define accountability towards market parties, the legislative and executive powers, the European Commission, the courts and peers. These two indexes are then analysed against an index of perceived quality of the work of NRAs.

The CERRE Report shows that the EU model works: the more independence and the more accountability, the better the perceived quality.

It also corrects some common misunderstandings: the EU model goes beyond independence of NRAs alone, it also requires accountability. Furthermore, independence and accountability do not need to contradict each other. They can be reconciled.

Keywords: Regulatory agencies, independence, accountability, European Union

JEL Classification: K23, L50

Suggested Citation

Hanretty, Chris J. and Larouche, Pierre and Reindl, Andreas P., Independence, Accountability and Perceived Quality of Regulators (March 6, 2012). Available at SSRN: https://ssrn.com/abstract=2063720 or http://dx.doi.org/10.2139/ssrn.2063720

Chris J. Hanretty

European University Institute ( email )

Badia Fiesolana
14 via Roccettini
Firenze (Florence), 50014
Italy

Pierre Larouche (Contact Author)

Université de Montréal ( email )

Montreal, Quebec H3T 1B9
Canada

Center on Regulation in Europe (CERRE) ( email )

Rue de l'Industrie 42
Brussels, 1040
Belgium

Andreas P. Reindl

Independent ( email )

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