Government by regulation structures how constitutional democracies normally operate. Legislatures and executive agencies enact formal rules that govern conduct, embodying the ideal of government by laws rather than by individuals. Yet regulators also govern through threats of regulation. When public officials seek to alter private behavior, they may warn regulated actors that failure to comply will trigger new or stricter rules. These warnings can achieve regulatory goals without the adoption of formal rules. Because officials often issue such threats in informal, private communications, the practice escapes public scrutiny and challenges the dominant model of democratic rule-making, which assumes open deliberation by accountable institutions. This paper theorizes threats of regulation as a governance device that remains largely invisible to outsiders but offers significant advantages to regulators. Although United States courts attempt to distinguish unlawful coercion from permissible persuasion, they struggle to enforce these boundaries in practice. The paper argues that increasing transparency in routine communications between regulators and corporate actors would reduce the risk of abuse while preserving regulatory effectiveness.
Ramiro Álvarez Ugarte (Mon,) studied this question.