Retrenchment, Reform Or Revolution - The Shift to Incentives and the Future of the Regulatory State

Abstract

A shift to incentive-based instruments of regulation is often viewed as a solution to the defects and limits of the traditional regulatory state. This article argues that, although in some contexts incentive-oriented approaches are desirable, there are limits to the use of economics in the regulatory process, particularly with respect to defining the goals of regulation in a pluralist democracy. As well, traditional policy instruments can be altered, evolved or supplemented to allow for belter government. There are many ways that government can bring about basic social change that neither suggest a return to old command and control approaches nor an increased reliance on or deference to economically self-interested market behaviour. It is these alternative approaches that are most promising for advancing the unfinished agenda of the social welfare slate, through a better reconciliation of care with autonomy and choice with community.