Document Type
Article
Publication Date
2017
Abstract
This Article examines what we term “regulatory entrepreneurship” — pursuing a line of business in which changing the law is a significant part of the business plan. Regulatory entrepreneurship is not new, but it has become increasingly salient in recent years as companies from Airbnb to Tesla, and from DraftKings to Uber, have become agents of legal change. We document the tactics that companies have employed, including operating in legal gray areas, growing “too big to ban,” and mobilizing users for political support. Further, we theorize the business and law-related factors that foster regulatory entrepreneurship. Well-funded, scalable, and highly connected startup businesses with mass appeal have advantages, especially when they target state and local laws and litigate them in the political sphere instead of in court. Finally, we predict that regulatory entrepreneurship will increase, driven by significant state and local policy issues, strong institutional support for startup companies, and continued technological progress that facilitates political mobilization. We explore how this could catalyze new coalitions, lower the cost of political participation, and improve policymaking. However, it could also lead to negative consequences when companies’ interests diverge from the public interest.
Keywords
entrepreneurship, startups, corporate political activity, lobbying, corporations, political economy, regulation, law and economics, sharing economy, platform, airbnb, uber, tesla, draftkings, fanduel, regulatory entrepreneurship
Publication Title
Southern California Law Review
Repository Citation
Pollman, Elizabeth and Barry, Jordan M., "Regulatory Entrepreneurship" (2017). All Faculty Scholarship. 2556.
https://scholarship.law.upenn.edu/faculty_scholarship/2556
Included in
Business Organizations Law Commons, Law and Economics Commons, Political Economy Commons, Technology and Innovation Commons
Publication Citation
90 S. Cal. L. Rev. 383 (2017)