We propose an activity-generating theory of regulation. When courts make errors, tort litigation becomes unpredictable … risk, this type of regulation can raise welfare …

. Consistent with firms seeking to avoid costly regulation, we document significant bunching around multiple regulatory thresholds …

competitive behavior under arbitrary information structures. Building on this observation, we develop a theory of data …-driven regulation based on "safe tests," i.e. tests that are passed with probability one by competitive bidders, but need not be passed …

basic and ubiquitous features of regulation as actually implemented throughout the world has received little theoretical … because exemption induces additional harmful activity to be channeled their way. This article analyzes optimal regulation with … regulation, which illustrates the contrast with the mechanism design approach that analyzes the optimal use of instruments of a …

disclosure requirements that exist in these markets. We show that reducing the number of charlatans through regulation decreases … regulation, implying that the regulation we observe in these markets likely derives from producer interests. Using these insights …

This article surveys the theory of the public enforcement of law -- the use of public agents (inspectors, tax auditors …, police, prosecutors) to detect and to sanction violators of legal rules. We first present the basic elements of the theory … examine a variety of extensions of the central theory, concerning accidental harms, costs of imposing fines, errors, general …