Expert Advice and Regulatory Complexity

Ex-regulators often enjoy lucrative periods either working for, or selling advice to, the industry they previously policed. Conventional wisdom is that such jobs are rewards for earlier favors and indicate capture of the regulator by the industry. In the model here, successive generations of regulators maintain an excessively opaque "regulatory interface". The opacity underpins their post-regulatory employability and has, we will argue, a self-sustaining character. The analysis points to a causal link between the phenomenon of the revolving door, the oft-alleged over-complexity of regulatory practices and procedures, and resistance to their reform. The industry can be said to have been "captured" by the regulator. Cooling-off periods may or may not be useful in mitigation.