Agents Without Principals?: Delegation in an Age of Diffuse and Fragmented Governance
Peter L. Lindseth
University of Connecticut School of Law
February 1, 2004
REFRAMING SELF-REGULATION IN EUROPEAN PRIVATE LAW, Fabrizio Cafaggi, ed., Kluwer Law International, 2006
In an earlier essay, Professor Lindseth argued that the notion of delegation from the national legislature, as well as the principal-agent relationship that it implies, should be retained in our understanding of the transfer of regulatory power from the nation-state to supranational institutions. This essay extends this argument to self-regulation and privatization.
The nature of regulatory power in an era of diffuse 'governance' admittedly makes it difficult to sustain the notion of delegation empirically (because the effective holders of regulatory power do not operate under the national legislature's supervision and control in any realistic sense). Nevertheless, because constitutional institutions of national 'government' - at the core of which is the elected legislature - are still widely viewed as privileged expressions of national self-rule, this strongly suggests that we must retain some form of the notion normatively, even where its empirical underpinnings may be questionable.
A specific historiographical perspective guides this normative commitment to the notion of delegation. Self-regulation and privatization, along with supranationalism, should be understood historically as aspects of the same phenomenon of diffusion and fragmentation of normative power that began with the emergence of the modern administrative state in the first third of the twentieth century. As with the administrative state, any durable constitutional settlement of the emergent system of regulation will need to incorporate how changing structures of public governance are 'experienced' in relation to historically-rooted ideas and values of legitimate government inherited from the past.
Working from this perspective, this essay examines the thesis recently advanced in the scholarly literature which describes the relationship between government and governance in terms of contract rather than of delegation. The primary drawback in the contractual approach, aside from the questionable parity it suggests between the public and private spheres in matters of public regulation, is the manner in which it renders the imposition of procedural and substantive constraints on private regulatory authority a matter of mere political expediency. Rather, when private actors exercise public regulatory power (that is, power exercised in pursuit of publicly-defined ends and backed up by the coercive power of the state), the imposition of such constraints becomes a matter of constitutional necessity.
Delegation constraints are necessary not merely to ensure that private actors remain within the bounds of their delegated authority and exercise their authority reasonably. Rather, these kinds of constraints, properly structured, should facilitate the flow of information about how the delegated normative power is actually being used, and in this way they are critical to governmental monitoring of norm-production in the diffuse system of governance. Delegation constraints are thus a matter of constitutional necessity because they are essential to maintaining the connection between the diffuse system of governance and the institutions of constitutional government that remain the primary locus of democratic legitimacy in modern political life.
Number of Pages in PDF File: 26
Keywords: Self-regulation, privatization, governance, delegation, administrative state
JEL Classification: H11
Date posted: October 17, 2004 ; Last revised: March 28, 2012