Thursday, November 27, 2003


Regulation often stimulates the very behaviour it is supposed to control. For example, in the Corporate Governance field, precise specification of codes of conduct sometimes seems to positively encourage people to find creative ways of complying with the letter, while being in flagrant breach of the spirit.

The POSIWID principle suggests that the purpose of regulation systems is to maintain a stable level of something bad, rather than to eliminate it - since this is (at best) what they actually achieve most of the time.

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