Cary Coglianese (U Pennsylvania Carey Law) and Oren Perez (Bar-Ilan U Law) have posted “Fighting Risk with Risk” (University of Illinois Law Review, forthcoming) on SSRN. Here is the abstract:
A growing scholarly and policy debate pits advocates of the precautionary principle, who prioritize risk minimization, against proponents of an innovation principle, who argue that regulation suppresses technological progress. Despite their differences, both camps share the assumption that contemporary regulatory law is shaped by a risk-averse orientation that is fundamentally at odds with the risk-seeking ethos of technological entrepreneurship in fields such as artificial intelligence. What this debate overlooks is an alternative approach altogether—one that deliberately embraces risk as a vehicle for risk reduction. Instead of fighting risk by restricting, delaying, or controlling risky activity, the government sometimes justifiably fights risk by embracing risk under legally structured conditions.
In this article, we introduce and offer a theory of this overlooked strategy. Drawing on examples as varied as so-called ethical hacking used to expose cybersecurity vulnerabilities, prescribed forest burning to prevent catastrophic wildfires, and geoengineering to combat climate change, we explain how fighting risk with risk differs from—as well as shares affinities with some elements of—the two sides of the dichotomous precautionary and innovation-oriented paradigms that make up contemporary debate over risk governance.
We offer a framework for deciding when government is justified to fight risk with risk, and when it should revise or discontinue such efforts. This inquiry implicates first-order questions—namely, the welfare implications of risk–risk tradeoffs and the distributive consequences of shifting exposures to risks—and second-order questions concerning the epistemic challenges in authorizing or deploying risk as a strategy for risk governance. These challenges involve making decisions under uncertainty across the policy life cycle, mitigating institutional and behavioral biases, structuring liability and compensation regimes for the risks that law deliberately embraces, and building reflexivity in an often-fragmented institutional environment.
To address these challenges, we advance a meta-regulatory architecture rooted in reflexivity—the capacity of legal institutions to adapt and update policies as evidence, risks, and priorities evolve. This architecture rests on four interlocking elements, each of which corresponds with the main challenges we identify: dynamic updating; structures to counteract cognitive biases; targeted liability and compensation; and collaborative mechanisms that enable coordinated revision. Without such governance mechanisms, regulatory authorities that embrace risk may inadvertently entrench policies whose harms outweigh their benefits and whose inequitable effects deepen existing vulnerabilities in society.
By highlighting how government can affirmatively embrace risk as a risk governance strategy, we seek to bring a fresh perspective to the precaution-versus-innovation debate and point to other ways that law can confront the harms facing society today. The debate between precaution and innovation is incomplete, if not also overly simplistic. Regulating in a highly dynamic world necessitates an equally dynamic posture toward risk. In a fast-paced era defined by climate change and new technologies, society surely requires some precautionary forms of risk governance that minimize risk, as well as some government policies that promote innovation. But it will also at times require strategies that deliberately deploy risk to avert greater harm. The meta-regulatory framework we propose offers a blueprint for embracing risk by integrating economic efficiency with a commitment to distributive fairness. That framework also points to how regulators should act more generally in the face of the risks of new technologies and a changing world.
