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Legislators v. Regulators: The Case of Low Power FM Radio


  • Hazlett Thomas W

    (Manhattan Institute and The Wharton School)

  • Viani Bruno E

    (Franklin and Marshall College)


The Federal Communications Commission rule making for low power FM radio was widely reported as an instance where Congress sharply rebuked a regulatory agency for enacting rules too favorable to entrants. Theories of bureaucratic control generally agree that when such events occur, policy differences of Congress and the agency must be large. Because rival policy positions are quantifiable in this case, the preferences of Congress and the Commission can be directly evaluated. While the distance between the policy position of the Commission and Congress appear large, they signified a negligible increment in competition when compared to a benchmark efficient policy. A financial event study supports this interpretation, as radio broadcasters equity values were not materially affected by either events in Congress or the Commission. Thus, even marginal differences may prompt a costly intervention by Congress to ostensibly discipline an agency.

Suggested Citation

  • Hazlett Thomas W & Viani Bruno E, 2005. "Legislators v. Regulators: The Case of Low Power FM Radio," Business and Politics, De Gruyter, vol. 7(1), pages 1-33, April.
  • Handle: RePEc:bpj:buspol:v:7:y:2005:i:1:n:1

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    1. repec:cup:apsrev:v:83:y:1989:i:04:p:1181-1206_08 is not listed on IDEAS
    2. Morten Bennedsen & Sven E. Feldmann, 2002. "Lobbying Legislatures," Journal of Political Economy, University of Chicago Press, vol. 110(4), pages 919-948, August.
    3. repec:cup:apsrev:v:92:y:1998:i:03:p:611-621_21 is not listed on IDEAS
    4. Austen-Smith, David, 1998. "Allocating Access for Information and Contributions," Journal of Law, Economics, and Organization, Oxford University Press, vol. 14(2), pages 277-303, October.
    5. Bennedsen, Morten & Feldmann, Sven E., 2006. "Informational lobbying and political contributions," Journal of Public Economics, Elsevier, vol. 90(4-5), pages 631-656, May.
    6. repec:cup:apsrev:v:88:y:1994:i:01:p:33-47_09 is not listed on IDEAS
    7. repec:cup:apsrev:v:90:y:1996:i:02:p:303-315_20 is not listed on IDEAS
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