Publication: Regulatory Instruments and Their Effects on Investment Behavior
Date
2004-04
ISSN
Published
2004-04
Author(s)
Burns, Phil
Riechmann, Christoph
Abstract
Regulatory instruments have long been
understood to have a powerful effect on investment, and part
of the motivation for introducing higher-powered regulatory
regimes and contracts was to reduce incentives for
inefficiency and over-investment (gold plating) inherent in
cost-plus regulatory schemes. In practice, the mix of
incentives and the institutional framework that make up a
higher-powered regulatory regime can also lead to unintended
distortions on investment behavior. The authors examine the
key drivers of investment behavior and provide some examples
of how these drivers have affected investment in practice.
They conclude with a set of key areas and interrelationships
that are at the core of a regulatory settlement, and
therefore need to be designed appropriately to drive
efficient investment behavior.
Link to Data Set
Citation
“Burns, Phil; Riechmann, Christoph. 2004. Regulatory Instruments and Their Effects on Investment Behavior. Policy Research Working Paper;No.3292. © World Bank, Washington, D.C.. http://hdl.handle.net/10986/14108 License: CC BY 3.0 IGO.”
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