From social media to mortgage-backed securities, innovation carries both risk and opportunity. Groups of people win, and lose, when innovation changes the ground rules. Looking beyond formal politics, this new book by Cristie Ford argues that we need to recognize innovation, and financial innovation in particular, as a central challenge for regulation. Regulation is at the leading edge of politics and policy in ways that we have not yet fully grasped. Seemingly innocuous regulatory design choices have clear and profound practical ramifications for many of our most cherished social commitments. Innovation is a complex phenomenon that needs to be understood not only in technical terms, but also in human ones. Using financial regulation as her primary example, Ford argues for a fresh approach to regulation, which recognizes innovation for the regulatory challenge that it is, and which binds our cherished social values and our regulatory tools ever more tightly together.

‘In Innovation and the State: Finance, Regulation, and Justice Cristie Ford provides a thorough analysis of the evolution of academic literature on ‘flexible regulation' and couples this with an analysis of different forms of innovation to consider how regulation can fulfil progressive social goals whilst coping effectively with the risks and uncertainties that innovations within markets can pose. Elegantly written and perceptively observed, this is a timely analysis which reminds us that regulation is a political and social project as well as a technical one.'

Julia Black - London School of Economics and Political Science

‘A tour de force of innovation and financial regulation. Cristie Ford is street smart, experienced on Wall Street. She explains how sedimentary innovation is bound to defeat inflexible rulish regulation. Yet sedimentary innovation also defeats flexible regulation, if it fails to fill the gaps that open within a scaffolding of regulatory principles. Ford's brilliant book teaches us to learn to see financial innovation. It cautions political wisdom in building loyalty to public values as regulators steer economic interests.'

John Braithwaite - Australian National University, Canberra

‘Like the words ‘growth' and ‘progress', ‘innovation' is often taken for granted as a public good. Indeed, it can be. But Cristie Ford shows in this deep and thoughtful book the way this taken-for-grantedness has seduced regulators, academics and the public into a set of beliefs that undermines the necessary task of regulation itself. She points the way forward to a more sophisticated interaction between regulation and innovation in a more just, progressive society.'

Donald Langevoort - Georgetown University, Washington, DC

'Many scholars, including Cristie Ford, have analyzed particular aspects of these phenomena, and how they matter to business and financial policy. What no one has done before, is build a broad philosophical construct for assessing these phenomena, so that policy makers might produce innovation-ready financial regulation. Professor Ford addresses regulatory design and structure, adaptability, and our own assumptions in ways that should help academics and policy makers think more precisely about optimal financial regulation in the future.'

Frank Partnoy - University of San Diego, School of Law