POWER, STRATEGY AND GAMES - ECONOMIC-REGULATION OF A PRIVATIZED UTILITY

This article rejects conventional 'rational actor' models of economic regulation in favour of a focus on processes of resource exchange and dependence. Using a case-study of Yorkshire Water it identifies the me mbership and structure of the regulatory arena, the resources availabl e to regulatory actors, the 'rules of the game', and the strategies ad opted by regulator and regulated. It highlights the structurally privi leged position of investors in water regulation and concludes that dec ision-making excludes customer interests; decisions are made by profes sional actors on the basis of co-operation and consensus; the regulato r is relatively weak and depends on companies compliance to maintain i ts own legitimacy; and large companies have a great range of strategic options in pursuit of regulatory advantage.