Social Europe

politics, economy and employment & labour

  • Projects
    • Corporate Taxation in a Globalised Era
    • US Election 2020
    • The Transformation of Work
    • The Coronavirus Crisis and the Welfare State
    • Just Transition
    • Artificial intelligence, work and society
    • What is inequality?
    • Europe 2025
    • The Crisis Of Globalisation
  • Audiovisual
    • Audio Podcast
    • Video Podcasts
    • Social Europe Talk Videos
  • Publications
    • Books
    • Dossiers
    • Occasional Papers
    • Research Essays
    • Brexit Paper Series
  • Shop
  • Membership
  • Ads
  • Newsletter

The World Is Digitalising – So Too Should Regulators

by Claire Ingram Bogusz and Mariell Juhlin on 6th September 2018 @mariell_juhlin

Share on TwitterShare on FacebookShare on LinkedIn
Claire Ingram Bogusz

Claire Ingram Bogusz

Governments, including the Swedish government, are beginning to explore how legislating could be improved in light of digital technologies. This is welcome but something that businesses and business leaders have known for some time: the data being generated by our interactions in the digital world holds more potential than just the optimisation of what advertising we see.

In general, legislation is only ever as effective as the probability of its enforcement. In the borderless digital world, where today’s regulators and enforcers still enjoy only an analogue presence, that possibility of enforcement is significantly diminished. However, digital advances mean that data from both physical sensors and economic activities online, enforced through policy-maker-generated code, could change this. In particular, such data could be used for three things: 1) insight into regulation effectiveness; 2) automated oversight, and 3) pro-active compliance.

Mariell Juhlin

Mariell Juhlin

Digitalisation indeed has the potential to empower regulators and authorities. They, too, can use digital tools not only to increase public awareness of laws, as they do today, but also to fine tune and enforce them.

Insight into effectiveness

GDPR, which has been on everyone’s lip and in everyone’s inbox, exemplifies how complex the digital world has become. Data is generated from every corner and its collection and use is hard for individuals to track. For this reason, the European Union decided to regulate data use and collection; in large part because data was being collected and used unethically, but also because it’s never been easy for the average user to trace how their data online is being used. While the GDPR is well-intentioned, it will prove hard to enforce for the very reasons that made it necessary in the first place: regulators could not, and still cannot, see how and by whom data is being collected.

Following the GDPR example, were legislators (or enforcers) able to track how data is collected, and by whom, they would themselves be able to examine how effective GDPR has been, not wait for ex post reports of problems—which are likely to under-represent breaches. This ability to examine effectiveness is not just crucial for the legitimacy and effectiveness of legislation, it will also allow legislators to fine-tune regulations in line with changing social and technological conditions.

Take the Blockchain, for instance. Blockchain enthusiasts point to how this (perhaps hyped) piece of technology is inconsistent with GDPR: the immutability of Blockchain records, a feature of the technology, means that data cannot be removed from a distributed ledger. How are legislators to respond to this? Discussions at the EU level are ongoing, but data around the effectiveness of existing GDPR regulations would support these decision processes.

Join our growing community newsletter!

"Social Europe publishes thought-provoking articles on the big political and economic issues of our time analysed from a European viewpoint. Indispensable reading!"

Polly Toynbee

Columnist for The Guardian

Thank you very much for your interest! Now please check your email to confirm your subscription.

There was an error submitting your subscription. Please try again.

Powered by ConvertKit

Automated oversight

The same digital tools that allow for insight into regulations’ effectiveness will also allow for oversight and monitoring of the nuances of regulatory compliance.

Not only would this allow for more effective regulating, it would provide a basis to measure and assess proportionality, allowing regulators to better assess whether, for instance, a set of regulations is adversely affecting a specific industry. It would also make compliance something that occurs automatically, lightening the burden it imposes on firms with simple business models, or in early stages of development.

Take financial transactions. In principle, these digital interactions leave a trail of data that can be used to understand, measure and tweak legislation to improve reach and impact. Collecting this data could even be anonymous in nature: with the right tools, individuals can retain digital integrity, while authorities obtain aggregate and metadata with which to develop insights and train algorithms.

Thus far, regulators have chosen to set technical standards (e.g. in PSD2), rather than develop code as a way of ensuring compliance. However, we believe that this is less effective than the other possibilities open to regulators. Standards may “set the scene”, but do not increase the probability of compliance and enforcement—and certainly do not allow for a nuanced understanding of the effects of regulation. Given the pace of innovation and disruption enabled by digitalisation, ensuring that regulation encourages, rather than hinders, fair competition is more important than ever before.


We need your help! Please join our mission to improve public policy debates.


As you may know, Social Europe is an independent publisher. We aren't backed by a large publishing house or big advertising partners. For the longevity of Social Europe we depend on our loyal readers - we depend on you. You can support us by becoming a Social Europe member for less than 5 Euro per month.

Thank you very much for your support!

Become a Social Europe Member

Pro-active compliance

While data collection and analysis is largely reactive, digital technologies also allow for pro-active compliance. This could be done through legal obligations to include certain modules in a digital product or service offering. Such modules are likely to be in the form of code and include self-executing contracts, automatic reporting and real-time data collection and analytics. However, they could also include digital sensors that monitor real-world conditions using digital tools.

Peer-to-peer platforms could, for instance, be obliged to include modules that connect to APIs maintained by trade unions to check for relevant collective agreements. Regulators could even require that other kinds of digital platforms, for instance those that sell products with taxes attached to them, include code modules that automatically and instantly pay taxes. This would make tax evasion when using portals like Airbnb and similar nearly impossible.

Tamper-free, built-in, digital IoT sensors could allow for automated, real-time compliance with environmental standards, for instance by assessing emissions from production or construction sites.

Today, code-as-law makes sense for the most simple of applications. However, complex rules that require flexibility and the ability to respond to social changes could also be on the horizon, as technologies that include AI and contextual learning advance.

Regulators need to get involved in the development of code—both for the protection of consumers, as in the example of GDPR, and in order to make legal enforcement credible. Governments, to be effective, thus need to become active agents in the network economy. This will require a shift in mind-set and the acquisition of new skills and competencies within regulatory agencies around EU Member States as well as within the European Institutions themselves, the European Commission included.

Share on TwitterShare on FacebookShare on LinkedIn
Home ・ The World Is Digitalising – So Too Should Regulators

Filed Under: Politics

About Claire Ingram Bogusz and Mariell Juhlin

Claire Ingram Bogusz is a postdoctoral researcher at the Stockholm School of Economics. She has degrees in Economics, Political Science, Law, and Business Administration, and her current research looks at the effect of code and digitalisation on entrepreneurship and organisational practices in the finance industry. Mariell Juhlin is an economist with extensive experience of undertaking evidence-based evaluations and impact assessments of policies and regulations on behalf of European Institutions and EU Member State Governments. She is currently advising organisations on how to innovate and take full advantage of data-driven opportunities enabled through digitalisation.

Partner Ads

Most Popular Posts

Thomas Piketty,capital Capital and ideology: interview with Thomas Piketty Thomas Piketty
sovereignty Brexit and the misunderstanding of sovereignty Peter Verovšek
China,cold war The first global event in the history of humankind Branko Milanovic
centre-left, Democratic Party The Biden victory and the future of the centre-left EJ Dionne Jr
Covid 19 vaccine Designing vaccines for people, not profits Mariana Mazzucato, Henry Lishi Li and Els Torreele

Most Recent Posts

Uber,drivers,gig UK gig drivers recognised as workers—what next? Jill Toh
women workers,services Covid-19: a tale of two service sectors John Hurley
European Pillar of Social Rights,social pillar EU credibility as a people’s union rests on the social pillar Liina Carr
vaccine nationalism,Big Pharma Vaccine nationalism won’t defeat the pandemic Sharan Burrow
Can we change the climate on climate change? Karin Pettersson

Other Social Europe Publications

US election 2020
Corporate taxation in a globalised era
The transformation of work
The coronavirus crisis and the welfare state
Whither Social Rights in (Post-)Brexit Europe?

Social Europe Publishing book

With a pandemic raging, for those countries most affected by Brexit the end of the transition could not come at a worse time. Yet, might the UK's withdrawal be a blessing in disguise? With its biggest veto player gone, might the European Pillar of Social Rights take centre stage? This book brings together leading experts in European politics and policy to examine social citizenship rights across the European continent in the wake of Brexit. Will member states see an enhanced social Europe or a race to the bottom?

'This book correctly emphasises the need to place the future of social rights in Europe front and centre in the post-Brexit debate, to move on from the economistic bias that has obscured our vision of a progressive social Europe.' Michael D Higgins, president of Ireland


MORE INFO

Hans Böckler Stiftung Advertisement

Renewing labour relations in the German meat industry: an end to 'organised irresponsibility'?

Over the course of 2020, repeated outbreaks of Covid-19 in a number of large German meat-processing plants led to renewed public concern about the longstanding labour abuses in this industry. New legislation providing for enhanced inspection on health and safety, together with a ban on contract work and limitations on the use of temporary agency employees, holds out the prospect of a profound change in employment practices and labour relations in the meat industry. Changes in the law are not sufficient, on their own, to ensure decent working conditions, however. There is also a need to re-establish the previously high level of collective-bargaining coverage in the industry, underpinned by an industry-wide collective agreement extended by law to cover the entire sector.


FREE DOWNLOAD

ETUI advertisement

ETUI/ETUC (online) conference Towards a new socio-ecological contract 3-5 February 2021

The need to effectively tackle global warming puts under pressure the existing industrial relations models in Europe. A viable world of labour requires a new sustainability paradigm: economic, social and environmental.

The required paradigm shift implies large-scale economic and societal change and serious deliberation. All workers need to be actively involved and nobody should be left behind. Massive societal coalitions will have to be built for a shared vision to emerge and for a just transition, with fairly distributed costs, to be supported. But this is also an opportunity to redefine our societal goals and how they relate to the current focus on (green) growth.


REPLAY ALL SESSIONS

To access the videos, click on the chosen day then click on the ‘video’ button of your chosen session (plenary or panel). It will bring you immediately to the corresponding video. To access the available presentations, click on the chosen day then click on the ‘information’ button. Check the links to the available presentations.

Eurofound advertisement

Industrial relations: developments 2015-2019

Eurofound has monitored and analysed developments in industrial relations systems at EU level and in EU member states for over 40 years. This new flagship report provides an overview of developments in industrial relations and social dialogue in the years immediately prior to the Covid-19 outbreak. Findings are placed in the context of the key developments in EU policy affecting employment, working conditions and social policy, and linked to the work done by social partners—as well as public authorities—at European and national levels.


CLICK FOR MORE INFO

Foundation for European Progressive Studies Advertisement

FEPS Progressive Yearbook

Twenty-twenty has been an extraordinary year. The Covid-19 pandemic and the multidimensional crisis that it triggered have boosted existing trends and put forward new challenges. But they have also created unexpected opportunities to set a new course of action for the European Union and—hopefully—make a remarkable leap forward in European integration.

The second edition of the Progressive Yearbook, the yearly publication of the Foundation for European Progressive studies, revolves around the exceptional events of 2020 and looks at the social, economic and political impact they will have in 2021. It is a unique publication, which aims to be an instrument for the progressive family to reflect on the recent past and look ahead to our next future.


CLICK HERE

About Social Europe

Our Mission

Article Submission

Legal Disclosure

Privacy Policy

Copyright

Social Europe ISSN 2628-7641

Find Social Europe Content

Search Social Europe

Project Archive

Politics Archive

Economy Archive

Society Archive

Ecology Archive

.EU Web Awards