Barriers to entry in regulated markets are frequently conceptualized as static features that must be removed or overcome if new entrants are to successfully enter a market. But government institutions regulating markets often comprise multiple levels that exist in tension with one another due to differing incentives and motivations. We argue that the principal–agent tension between elected officials and agency bureaucrats may render regulatory barriers to entry more malleable, even in the absence of formal policy changes. To test this proposition, we bring the administrative state center stage and examine how regulatory discretion—regulatory agencies’ flexibility to interpret and implement public policies created by elected officials—can influence the market entry of new ventures. Using data on regulatory approval of hydroelectric facilities in the United States from 1978 to 2014, we find that increased state agency discretion improves outcomes for new ventures relative to incumbent firms by freeing regulatory agency officials to interpret and implement policies according to a professional motivation of public service and reducing incumbents’ political influence.

中文翻译：

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受监管市场中的国家机构自由裁量权和创业精神

进入受监管市场的障碍经常被概念化为静态特征，如果新进入者要成功进入市场，必须去除或克服这些特征。但是，监管市场的政府机构通常包括多个层次，由于激励和动机不同，这些层次相互之间存在紧张关系。我们认为，即使没有正式的政策变化，民选官员和机构官僚之间的委托代理紧张也可能使进入的监管壁垒更具可塑性。为了检验这一命题，我们将行政管理置于中央舞台，并研究监管自由裁量权——监管机构解释和实施民选官员制定的公共政策的灵活性——如何影响新企业的市场准入。