Beyond Regulation: Innovative strategies for governing large complex systems

Abstract

We have entered an era characterized by levels of complexity that are unprecedented in human experience. The hallmarks of complex systems are the growth of connectivity, the prominence of nonlinear patterns of change, the occurrence of bifurcations in contrast to oscillations, and frequent surprises associated with emergent properties. There are good reasons to question the adequacy of the standard repertory of practices associated with regulatory strategies in efforts to fulfill needs for governance in complex systems. Whereas regulatory strategies feature the articulation of rules expected to remain in place indefinitely and emphasize efforts to maximize compliance with the rules, governing complex systems calls for a willingness to experiment with innovative practices in the face of uncertainty and a capacity to adapt existing practices easily to new circumstances. It is helpful in this connection to distinguish between Type I governance, which is a matter of devising supplementary practices to augment rather than to replace regulatory measures in managing volatile oscillations, and Type II governance, which is a matter of devising new governance strategies to address needs for governance arising during periods of transformation and in the settings that become the new normal following major state changes. There is no need to discard familiar regulatory strategies. Rather, the challenge is to devise innovative steering mechanisms to augment the existing toolkit to meet needs for governance in the 21st century.