4 - Contradictions of governance in the nuclear energy sector

Summary

People advocating the development of nuclear power in the United States used to predict that one day the commercial nuclear energy sector would produce electricity so economically that it would be too cheap to meter. Today, so many problems plague nuclear power that in some places, nuclear plants under construction and nearly complete are too expensive to finish even though hundreds of millions of dollars have already been invested in them. This chapter explains how the problems that caused the dramatic rise and fall of commercial nuclear power in the United States led to the transformation of the sector's governance regimes, and, conversely, how different regimes contributed to development of these problems in the first place.

GOVERNANCE MECHANISMS AND SECTORAL COORDINATION

Organizational theorists have recently suggested that scarcities in resources, including capital, labor, and raw materials, and in information about competitors, suppliers, products, markets, technology, and government regulations lead to governance transformations (e.g., Lawrence and Dyer 1983). Although most of these scholars have not attempted to explain the origins of these scarcities, other observers have argued that they stem from the organizational characteristics of the sector's firms, such as their size and capital intensity, and certain characteristics of the sector's products and production technologies, including the rate of technological change and levels of technological sophistication. Furthermore, they have suggested that these characteristics help to determine which governance mechanisms become dominant in a sector (e.g., Hollingsworth and Lindberg 1985).