quality:correction, quality:corruption
Example

We test the public interest and regulatory capture hypotheses, in the context of the Swedish electricity market, by studying the factors influencing the Swedish Energy Agency's decision to replace decision-makers it employs to hear customer complaints against utilities. We test if the regulator's decision to retain, or replace, the decision-maker, following a sequence of decisions, can be explained by whether the customer or utility is being favored by the civil servant. Based on whether the regulator replaces the decision maker that it has the power to appoint, we draw inferences about what theory can best explain the behavior of the regulator. The regulator can choose to favor the customer. To do so would be consistent with the fact that the primary objective of the electricity market reform in 1996 was to put the onus on the Swedish Energy Agency to provide stronger consumer protection against market abuse by the electricity utilities. On the other hand, the regulator might be captured because the utilities have more financial and legal resources and they have a well-established lobby organization which the customers do not have. It is not clear, therefore, whether customers or utilities have benefited most during the post-reform regulation.