Thu 2010-08-05 19:31 EDT
Nassim Nicholas Taleb: The Regulator Franchise, or the Alan Blinder Problem
...former regulators and public officials who were employed by the citizens to represent their best interests can use the expertise and contacts acquired on the job to benefit from glitches in the system upon joining private employment...the more complex the regulation, the more bureaucratic the network, the more a regulator who knows the loops and glitches would benefit from it later, as his regulator edge would be a convex function of his differential knowledge. This is a franchise...
Alan Blinder Problem; Nassim Nicholas Taleb; Regulator Franchise.