Understanding how regulatory capture occurs is essential for diagnosing capture where it exists, treating it appropriately when found, and designing new regulatory regimes that are resistant to it from the outset. The chapters in this section suggest that regulated entities and their representatives – in most cases, firms and industry organizations – employ a wider variety of mechanisms to influence regulation, and aim for a broader range of outcomes, than has generally been recognized. Achieving a deeper understanding of these mechanisms and outcomes is the first step toward better detection and mitigation of regulatory capture.

When considering mechanisms of capture, analysts frequently focus on crude incentives – such as the so-called revolving door – that provide industry with leverage over policy decisions by appealing to regulators’ personal self-interest. In this section, James Kwak, Nolan McCarty, and Luigi Zingales each explore new mechanisms of capture. These include cultural capture – in which regulators are influenced, even unknowingly, by industry through a combination of social, cultural, and intellectual currents (Kwak,Chapter 4); the provision of expertise by industry – in which, as a result of heightened complexity, regulators come to rely on industry expertise in ways that tilt decision making toward industry interests (McCarty, Chapter 5); and, perhaps most subtly of all, economists’ capture – in which industry influences and incentivizes scholars to favor an industry perspective in their work, thereby indirectly influencing regulators who rely on the scholars’ judgment and expertise in making decisions (Zingales, Chapter 6). Taken together, these chapters suggest that efforts to diagnose and prevent capture must take into account a far wider range of actors and strategies than has been typical in the study of regulation in the past.