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Power, Economic Policy and Regulation

Paper Session

Saturday, Jan. 3, 2026 10:15 AM - 12:15 PM (EST)

Philadelphia Convention Center, 303-B
Hosted By: Association for Evolutionary Economics
  • Chair: Scott Alan Carson, University of Texas Permian Basin

The Achilles' Heel of Hydrological Commons Governance: Lessons from Mariana on Institutional Capture and Power Asymmetries

Newton Carlini
,
Federal University of Paraná

Abstract

The 2015 Fundão dam collapse in Mariana (Brazil) exposed a systemic Achilles’ heel in the governance of hydrological commons. This paper argues that economic power asymmetries embedded in a mining-dependent regional political economy appear to bias regulatory mechanisms, reorienting them from instrumental problem-solving toward ceremonial validation of the status quo. Drawing on Original Institutional Economics and theory-testing process tracing, the study examines how corporate actors and specific state licensing agencies co-constructed a regulatory environment conducive to escalating risk. The analysis documents that (i) licensing conditionalities displaced precaution, (ii) basin-committee agendas excluded dam safety, and (iii) the Renova Foundation institutionalized cost-shifting, and it treats the Foundation not merely as a buffer, but as a mechanism for converting open-ended social liabilities into bounded and administratively programmable expenses. To counteract these pathologies, the paper proposes Institutional Scaffolding—design heuristics centered on epistemic independence and democratic auditability—while critically assessing failure modes.

Power Struggles in the Power Industry

Robert Loube
,
Rolka Loube

Abstract

A combination of policy choices and price relationships frequently guides the transition from one energy source to another. Policy choices, such as feed-in tariffs and the subsidization of technological change, alter price relationships. In the recent past, state resource portfolio standards along with the decline in the cost of renewable technologies created a preference for wind and solar generation to meet new generation requirements. However, the sudden and dramatic growth in data center demand for electricity may reverse this trend because stakeholders are calling for an increased reliance on natural gas, nuclear power and coal plants. This paper focuses on how the power to control the size of the market and to control who gets access to the market provides the power to withhold service leading to the ability to control what is built and who pays for it. Because the power to withhold supply is often embedded within the administrative rules of a regional transmission organization, changes in PJM’s rules will influence what type of plant will be built. Simultaneously, there is a struggle to determine who will pay for the resources needed to meet the increased data center demand for electricity. That struggle occurs in front of state regulatory commissions. In commission proceedings, the data center industry attempts to shift cost recovery responsibility onto other utility customers, forcing them to pay for the new power sources the data centers need.

Passing on Quad O Regulatory Effects without Effecting Equity: Crude Oil and Natural Gas Price Increases that Did Not Affect Corporate Returns

Scott Alan Carson
,
University of Texas Permian Basin

Abstract

Economic policies change power relationships between the same and producers. Methane is the primary component of natural gas and is released into the atmosphere during crude oil extraction, transportation, and refining. Reducing methane emissions is a key objective in mitigating greenhouse gas emissions. Two significant pieces of legislation related to the oil and gas industry are the Environmental Protection Agency (EPA) regulations and the Quad O standards, with Quad O serving as the EPA’s principal regulatory framework governing methane production, transportation, and storage. This study demonstrates that while Quad O’s implementation increased oil and gas prices, but that firm returns were not systematically affected by the implementation of either Phase I or Phase II. This suggests that markets with inelastic energy demand can pass the majority of regulatory costs onto consumers, without significant impacts on firm profitability.

A New Research Agenda for Energy Conflicts and Economic Coherence

Franklin Obeng-Odoom
,
University of Helsinki

Abstract

Institutional economists agree broadly that to appreciate ‘reasonable value’,
it is necessary for analyses to consider all possible transaction costs. That way, the challenge
of social costs, social stratification, and rent theft could be overcome. Using content analysis
I will – in my example of Guyana - discuss the findings in the light of theories of
resource conflicts. Guyana has sought and implemented lessons from Ghana, which was involved in the Ghana-Cote d’Ivoire case: Delimitation of the Maritime Boundary in the Atlantic Ocean decided by the International Tribunal for the Law of the Seas (Case 23). From these findings and discussion, the state of energy law, international law, property and political economy within stratification economics and
with them, a property theory of power can be extended.

Revisiting “The Menace of Competition and Gambling Deregulation”

Thomas E. Lambert
,
University of Louisville

Abstract

This paper continues the analysis and discussion of gambling deregulation from an institutional economics perspective done in the article “The Menace of Competition and Gambling Deregulation” by Atkinson, Nichols, and Oleson (2000). John R. Commons’ concept of the “menace of competition” is used to analyze how gambling industry regulations and laws are gradually changed in the last decades of the 20th Century, and this in turn helps the industry to grow and prosper throughout the US. Since the publication of this paper, much has changed in the gambling industry in the US. Sports gambling has grown dramatically since it has been allowed beyond the state of Nevada beginning in 2018, casino gambling and lotteries have somewhat peaked and are not growing as rapidly in the past, and horse racing has shrunk dramatically as many prominent and well known tracks have closed in this century due to falling attendance and aggregate racing gambling revenues. Charitable gaming has also suffered a decline, and dog racing has almost completely disappeared. Additionally, online gambling has made it easier than ever before to make wagers and play lotteries and slots. As gambling has proliferated across the US since the late 1970s, some of the newly legal forms of gambling have cannibalized much of the revenues of those that have been around longer legally, such as horse racing and charitable gambling. State tax revenues from gambling also appear to have plateaued. With such intense competition and with disposable personal income, a key to gambling expenditures, not growing as much this century as the second half of the last century, an industry shakeout and merger wave are occurring with various calls for less regulation and lower taxation as the gambling industry slowly becomes more concentrated.
JEL Classifications
  • B5 - Current Heterodox Approaches
  • L5 - Regulation and Industrial Policy