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How should the regulatory defaults be set?

This paper, the extension of the previous work [1], focuses on the effects of different levels of conservatism implicated in regulatory defaults on the estimates of risk. According to the postulated behaviors of regulated parties and the diversity of interests of regulators, in particular, various measures for evaluating the effect of conservatism in defaults are developed and their properties are explored. | Nuclear Engineering and Technology 50 2018 1099 1105 Contents lists available at ScienceDirect Nuclear Engineering and Technology journal homepage www.elsevier.com locate net Original Article How should the regulatory defaults be set Seung-Cheol Jang nuclear ENGINEERING AND TECHNOLOGY Check for updates Korea Atomic Energy Research Institute Daejeon South Korea ARTICLE INFO ABSTRACT Article history Received 26 March 2018 Received in revised form 2 July 2018 Accepted 15 July 2018 Available online 20 July 2018 How to choose defaults in risk-informed regulations depends on the conservatism implicated in regulatory defaults. Without a universal agreement on the approaches dealing with the conservatism of defaults however the desirability of conservatism in regulatory risk analyses has long been controversial. The opponent views it as needlessly costly and irrational and the proponent as a form of protection against possible omissions or underestimation of risks. Moreover the inherent ambiguity of risk makes it difficult to set suitable defaults in terms of risk. This paper the extension of the previous work 1 fo- Keywords Regulatory default Conservatism Decision-making Risk analysis Optimization Risk-informed regulation Nuclear regulatory commission cuses on the effects of different levels of conservatism implicated in regulatory defaults on the estimates of risk. According to the postulated behaviors of regulated parties and the diversity of interests of regulators in particular various measures for evaluating the effect of conservatism in defaults are developed and their properties are explored. In addition a simple decision model for setting regulatory defaults is formulated based on the understanding of the effect of conservatism implicated in them. It can help decision makers evaluate the levels of safety likely to result from their regulatory policies. 2018 Korean Nuclear Society Published by Elsevier Korea LLC. This is an open access article under the CC BY-NC-ND