Managing in the Regulatory Thicket: Regulation Legitimacy and Expertise
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2016 by The American Society for Public Administration Although the influence of government regulation on organizations is undeniable, empirical research in this field is scarce. This article investigates how the understanding of and attitudes toward government regulation among public, nonprofit, and for-profit managers affect organizational performance, using U.S. nursing homes as the empirical setting. Findings suggest that managers perceptions of regulation legitimacyviews of regulation fairness, inspectors effectiveness, and internal utility of the mandatespositively affect service quality. Subgroup analysis suggests that managers views of regulation matter in nonprofit and for-profit organizations but not in public organizations. In nonprofit homes, performance declines when managers report higher regulatory expertisebetter knowledge of the regulatory standards. In for-profit facilities, frequent communication with regulators lowers quality. These findings suggest that the regulated entities views of government regulation are central to their success, which necessitates improvements in the regulatory process.
