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Three areas of the FTC’s fairly extraordinary portfolio of policymaking responsibilities that affect the development of the internet stand out: (1) competition issues, (2) consumer protection issues, and (3) privacy and data protection. These three areas are linked by the FTC’s creation of policy by experimentation, assessment, and refinement, which ensures the FTC makes wise choices in the face of dramatic technological changes that characterize the internet. The three areas are also linked by institutional multiplicity, which may need to be reconfigured for internet-commerce policy.

Effective policy for internet-commerce requires investment in institutional building and implementation because the degree of the skill of implementation and quality of institutional arrangements shape the resulting policy. However, this often fails to occur because incumbent political leaders are motivated to make short-term gains for publicity rather than invest for future gains. Continuous improvement will be a challenge for the FTC in developing and implementing internet-related policies, but they are important due to the highly dynamic nature of the internet. A possible solution lies in treating enhancements to institutional infrastructure and agency capacity as essential duties of leadership and pressing regulators to describe what steps the agency is taking today to make it better in next five or ten years. Another move in the right direction would be adopting the good practices for competition and consumer protection agencies identified in the 2008 FTC self-assessment. Superior internet-related policy will come from investments made today in strong operational methods and institutional frameworks.

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GWU Legal Studies Research Paper No. 2012-22; GWU Law School Public Law Research Paper No. 2012-22

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