OECD publishes working paper on regulatory models for the digital economy, finds governments increasingly use blended approaches

The OECD has published a Regulatory Policy Working Paper that sets out a methodology for comparing regulatory models used in the digital economy, placing them on a spectrum from command-and-control to industry self-regulation according to flexibility and the relative roles of public and private actors. Applied to digital activities, the paper finds that governments are increasingly relying on blended models rather than a single approach, with public authorities typically retaining responsibility for regulatory objectives while delegating the means of compliance and parts of regulatory delivery to private actors under public oversight. The paper identifies six main models, command-and-control, performance-based regulation, market-based mechanisms, co-regulation, meta self-regulation and industry self-regulation, and links model choice to factors including technological maturity, risk levels, market structure, private-sector willingness and capacity, and public institutional readiness. Its assessment of digital services suggests the most public-led and most private-led models are often the hardest to apply in practice, given fast-changing technologies, information asymmetries and uneven industry organisation. Instead, regulators tend to use hybrid arrangements that combine delegation with supervision, supported by tools such as guidance, transparency reporting, audits, experimentation, horizon scanning and stronger in-house technical capability.