| In the 21st Century we are increasingly confronted with global risks, including climate change, food contamination, volatile financial markets, and contagious disease. More and more, these global risks are closely connected to emerging markets such as China, India, or Brazil. To control risk, Western countries have applied a combination of legal, economic, and voluntary regulatory instruments. Emerging markets have copied these instruments, but often effective implementation at the local level has been difficult, leaving national and global risks under-regulated. Risk regulation in emerging markets demands a new approach to regulatory theory. Current theory presupposes a basic level of enforcement and compliance, necessary for the effective functioning of all regulatory instruments. The question remains how effective regulation can be established when enforcement capacity is underdeveloped and disregard for the law is widespread, as is often the case in emerging markets. Risk regulation in emerging markets therefore requires the study of two key issues: 1 How can the mixture of regulatory instruments and enforcement strategies be adapted to fit relatively low enforcement capacity and compliance levels? 2 How can regulation, by state or non-state actors, help reach a tipping point where regulatory violation is the exception rather than the rule? This research aims to address these questions and stimulate regulatory theory for emerging markets. It does so through a paradigm case study: the regulation of air pollution of Chinese coal combustion power plants. Using unique qualitative and quantitative data, it studies how legal, economic, and voluntary regulatory instruments influence plant management decisions about emission reduction measures. It studies how regulatory instruments and enforcement can be matched feasibly to improve emission reduction measures. The research further explores reforms in existing and in alternative regulatory arrangements that can contribute to ending a mutually reinforcing situation of weak enforcement and pervasive regulatory violations. |
