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Newsletter n. 2/2021 | September-November


Are you up to date on the latest news from the Better Regulation world?
 

In the second number of the newsletter - the last of 2021, the Chairs continues with its aim to keep its readers up to date with the news of the last 3 months on better regulation. 

The news that appear in this number concern a  ground breaking opion of the Italian Council of State, the publication of the EU Better Regulation guidelines, the publication of relevant OECD documents, the discussion over regulating Facebook's news feed algorithm and other potentially noteworthy articles. 


Besides, the newsletter suggests you the latest publications and the past and upcoming conferences of potential interest.

The website welcomes research notes, in English or in Italian, from whoever has special interest in the regulatory landscape.

You can read here past issues of the newsletter.


Latest News

LUMSA UniversityUniversity of TrentoUniversity of TusciaScuola Universitaria Superiore Sant’Anna di Pisa – Institute of Law, Politics and Development, organized a seminar entitled “Smart cities and artificial intelligence”.
Keep reading »


The Italian Council of State sides with Better Regulation

The Italian Council of State submitted its opinion on the draft regulation containing amendments to the so-called culture bonus.
Keep reading »
 

The OECD published the 2021 outlook on Business and Finance, mainly focused on Artificial Intelligence. It is the seventh edition of the annual publication containing an analysis of the trends shaping the future of business, finance, and investment. 
Keep reading »
 

The OECD published 2021 Regulatory Policy Outlook, which maps country efforts to improve regulatory quality in line with the 2012 OECD Recommendation on Regulatory Policy and Governance, and shares good regulatory practices that can help close the gaps.
Keep reading »
 

The OECD Council at Ministerial level adopted the Recommendations of the council for agile regulatory governance to harness innovation. The document provides a conceptual framework and guidance for developing and implementing agile and resilient regulatory approaches. The recommendations are organised around four main pillars: 1) the need to adopt regulatory management tools; 2) the need for coordination and co-operation within the government and across boundaries, while also fostering the whole approach to innovation; 3) developing more agile and future proof regulations; 4)  addressing enforcement challenges raised by innovation. The aim is to undertake a paradigm shift and move towards more outcome-based and risk-based approaches.
Keep reading »
 

Nicoletta Rangone and Yuval Feldman (author of The Law of Good People and Behavioral Ethics and Compliance) keynote speakers at the international conference organised by the research network “Nudging applied to the better regulation: behavioural law and public policies”, headed by Prof. Juli Ponce Solé.

Prof. Fabiana Di Porto intervened on DigitEconomy.24 (Il Sole 24Ore) concerning the new frontiers of law with regard to AI and the Cloud. The professor discussed the strategy presented by the Italian Government for the Cloud of data and services of Public Administration, the relevance of using an experimental method before adopting a final configuration of the governance model, and expressed as regulatory sandbox serves to define future-proof and adaptive rules.
Keep reading »
 

In this issue is given account of some new regulations introduced by independent national authorities on better regulation (Carolina Raiola; Maria Bianca Armiento).
It is illustrated the status of the more traditional instruments for improving regulatory quality at the level of central administrations (Simona Morettini). It also deals with a crucial issue for the present and future of representative democracy, which concerns the relationship between the executive and parliament in times of crisis (Elena Griglio), and an increasingly topical tool in the international debate for dealing with periods of crisis and beyond, namely that of international regulatory cooperation (Luca Megale). It closes with a review of a scientific article that takes stock of experimental forms of regulation (Francesco Calisi). 
Keep reading »


New EC Better Regulation guidelines 

The European Commission published the Better Regulation guidelines. The document, following a brief introduction, analyses the key concepts and principles of Better Regulation (Ch.1), the issue of stakeholder consultation (Ch.2), evaluation - including suitability checks (Ch.3), impact assessment (Ch.4) and implementation, transposition and enforcement of EU law (Ch.5).
Keep reading »

On 18th September 2021, the Wall Street Journal published the Facebook files. Facebook inc. appears "to know that its platforms are riddled with flaws that cause harm, often in ways only the company fully understands". The central finding is based on a review of internal Facebook documents, including research reports, online employee discussions, and drafts of presentations to senior management.
Keep reading »
 

The CNR published a paper on 'Artificial Intelligence for Sustainable Development' focused on the implications that AI can bring into the 17 Sustainable Development Goals of the UN 2030 Agenda.
Keep reading »
 

 
Artificial intelligence for risk-based controls: this approach has been implemented in Campania, Lombardy Regions and in Trento so as to improve the effectiveness of inspections in various sectors. The report focuses on data management tools and information technology for more efficient risk-based regulatory delivery, the role of machine learning in risk analysis and predictive modelling, and discusses areas for future development. 
The UK launched a consultation on a new approach to make regulation, including proposals for a revised Better Regulation Framework. The consultation follows a report from the Taskforce on Innovation, Growth and Regulatory Reform, containing several recommendations on the need to revise the Better Regulation Framework. It follows the idea that Brexit gives to the UK the opportunity to revise its approach to regulation and put its interest first.
Submit your research note
The submissions should concern news on better regulation tools, simplification policies, markets regulation, new technologies and regulation, cognitive-based regulation, and competition advocacy. The note might regard a newly published paper or a European, international, national or local document as well as policy devoted to these topics.

Publications

As intuitive statisticians, human beings suffer from identifiable biases, cognitive and otherwise. Human beings can also be “noisy,” in the sense that their judgments show unwanted variability. As a result, public institutions, including those that consist of administrative prosecutors and adjudicators, can be biased, noisy, or both. Both bias and noise produce errors. Algorithms eliminate noise, and that is important; to the extent that they do so, they prevent unequal treatment and reduce errors. In addition, algorithms do not use mental short-cuts; they rely on statistical predictors, which means that they can counteract or even eliminate cognitive biases. At the same time, the use of algorithms, by administrative agencies, raises many legitimate questions and doubts. Among other things, they can encode or perpetuate discrimination, perhaps because their inputs are based on discrimination, perhaps because what they are asked to predict is infected by discrimination. But if the goal is to eliminate discrimination, properly constructed algorithms nonetheless have a great deal of promise for administrative agencies.
Governments are created and run by humans, who can experience the same behavioural biases and barriers as individuals in society. Therefore, it makes sense to explore how behavioural insights (BI) can be applied to the governance of regulatory policy making, and not just to the design of regulations themselves. Applying BI can help improve the efficiency and effectiveness of the decision-making process, which can, in turn, help improve regulatory decisions. This paper maps the ways in which barriers and biases can affect the institutions, processes and tools of regulatory governance, with a focus on regulatory oversight bodies and regulatory management tools. It concludes with practical ways governments can translate these findings into research and reforms that can help future-proof regulatory policy making and ensure it is agile, responsive and fit for tackling important and complex policy challenges.

 
Since the original publication of Nudge more than a decade ago, the title has entered the vocabulary of business people, policymakers, engaged citizens, and consumers everywhere. The book has given rise to more than 400 “nudge units” in governments around the world and countless groups of behavioral scientists in every part of the economy. It has taught us how to use thoughtful “choice architecture”—a concept the authors invented—to help us make better decisions for ourselves, our families, and our society. Now, the authors have rewritten the book from cover to cover, making use of their experiences in and out of government over the past dozen years as well as an explosion of new research in numerous academic disciplines. To commit themselves to never undertaking this daunting task again, they are calling this the “final edition.” It offers a wealth of new insights, for both its avowed fans and newcomers to the field, about a wide variety of issues that we face in our daily lives—COVID-19, health, personal finance, retirement savings, credit card debt, home mortgages, medical care, organ donation, climate change, and “sludge” (paperwork and other nuisances we don’t want, and that keep us from getting what we do want)—all while honouring one of the cardinal rules of nudging: make it fun!

 
F. Molinari; C. Van Noordt; L. Vaccari (2021)
AI Watch. Beyond pilots: sustainable implementation of AI in public services

 
This report, in particular, follows a previous landscaping study and collection of European cases, which was delivered in 2020. This document first introduces the concept of AI appropriation in government, seen as a sequence of two logically distinct phases, respectively named adoption and implementation of related technologies in public services and processes. Then, it analyses the situation of AI governance in the US and China and contrasts it to an emerging, truly European model, rooted in a systemic vision and with an emphasis on the revitalised role of the member states in the EU integration process, Next, it points out some critical challenges to AI implementation in the EU public sector, including: the generation of a critical mass of public investments, the availability of widely shared and suitable datasets, the improvement of AI literacy and skills in the involved staff, and the threats associated with the legitimacy of decisions taken by AI algorithms alone. Finally, it draws a set of common actions for EU decision-makers willing to undertake the systemic approach to AI governance through a more advanced equilibrium between AI promotion and regulation. The three main recommendations of this work include a more robust integration of AI with data policies, facing the issue of so-called “explainability of AI” (XAI), and broadening the current perspectives of both Pre-Commercial Procurement (PCP) and Public Procurement of Innovation (PPI) at the service of smart AI purchasing by the EU public administration. These recommendations will represent the baseline for a generic implementation roadmap for enhancing the use and impact of AI in the European public sector.
It is human to make mistakes. It is indisputably human to make mistakes while filling in tax returns, benefit applications, and other government forms which are often tainted with complex language, requirements, and short deadlines. However, the unique human feature of forgiving these mistakes is disappearing with the digitization of government services and the automation of government decision-making. While the role of empathy has long been controversial in law, empathic measures have helped public authorities balance administrative values with citizens’ needs and deliver fair and legitimate decisions. The empathy of public servants has been particularly important for vulnerable citizens (e.g., disabled individuals, seniors, underrepresented minorities, low income). When empathy is threatened in the digital administrative state, vulnerable citizens are at risk of not being able to exercise their rights because they cannot engage with digital bureaucracy.


Laura Ammanati (2021)
"Neo-feudalism" in the age of algorithms

Digital platforms have strengthened their power more and more by collecting and exploiting data processed through algorithms. Economic and social interactions are increasingly shaped by the technology and software. Such a reliance on digital technologies has brought about the tendency of private subjects (but also of public institutions) to replace traditional norms and rules with regulations based on the code (code is law). From this perspective digital giants are no longer market participants. Rather they are market makers and exert regulatory control over the terms which define the positions of commercial and final users. Moreover they aspire to displace more governmental and public roles over time, performing functions and tasks normally vested in public authorities such as judicial bodies and courts. This shift in power towards private actors has led to an expanding privatization in the field of individuals’ rights as well. Algorithms are replacing the traditional functions of law embedding private values and interests in the technology. They represent the key of digital platforms’ power. Therefore regulators should ‘capture’ the algorithm to steer its effects and thanks to the technology be able to introduce regulatory principles into the design of the digital code.


Florentin Blanc; Giuseppa Ottimofiore; Kevin Myers (2021)
From OSH regulation to safety results: Using behavioral insights and a “supply chain” approach to improve outcomes – The experience of the health and safety Executive
 
This paper considers briefly theoretical foundations of the links between regulation, “regulatory delivery” and compliance, and then a case study of construction safety regulation in Britain, and comparative data on occupational safety inspections and outcomes in Britain, Germany and France (European Union member states with generally comparable OSH regulations but very different regulatory delivery). It studies the use of behavioral approaches by the Health and Safety Executive (HSE) in Great Britain, where engagement with regulated entities, managers, workers and other stakeholders to improve OSH is central. It provides a brief analysis of how approaches to regulatory delivery based on behavioral insights can result in greater efficiency, increased compliance and more positive public outcomes. These approaches differ from a traditional “deterrence-based” conception of regulatory enforcement limited to finding and punishing violations. Evidence suggests that such behavior-focused regulatory delivery can be both more efficient and more effective.

Conferences
Smart Cities and Artificial Intelligence
1 December 2021

ADDE - Transizioni economiche e dinamiche giuridiche
2 December 2021

Digital Platforms Regulation: Towards a Comprehensive Policy Framework
14 December 2021

Annual Conference of the Italian Society of Law and Economics (SIDE - ISLE) 
15-17 December 2021

Columbia University/Bank Policy Institute 2022 Research Conference on Bank Regulation "Key risks and Challenges for Regulation: Climate and Digitalization"
11 February 2022


The Jean Monnet Chair on EU Approach to Better Regulation aim is to contribute to solutions for the crisis of confidence in regulation at all levels of governance. Its research focuses on the key European tools of Better Regulation (impact assessment, regulatory burden measurement, ex-post evaluation, consultation), the in-practice application, the elaboration of how they can be reframed according to a cognitive-based approach. 
The Chair goal is also to inform and raise awareness among citizens on their rights and opportunities when confronted with a regulatory process or a regulation.  The Chair addresses all the above, with a theoretical/practical and multidisciplinary approach blending law, economics, and psychology, within its teachings. The latter are divided into three courses. The EU Approach to Better Regulation (40hrs) and Better Regulation Advanced (20hrs) Master courses for students that have traditionally received fragmented training in European Regulation and that - without this opportunity - would probably never come into contact with studies on European Regulation. The Intensive Professional Course (30 hours) for practitioners and future professionals which meets unanswered demands for training in the use of all Better Regulation tools. 

 
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