Solving the "Chevron" Puzzle

Abstract

Supreme Court announced a now famous doctrine. When the federal courts review an administrative agency's interpretation of its own statute, the agency's interpretation may be set aside only if Congress has "directly spoken to the precise question at issue" 2 and the agency's interpretation fails to conform to congressional intent. Congress may speak to a question either by enacting clear language, or by unambiguous legislative history. If congressional intent is unclear or missing, the federal courts must defer to the administrative interpretation as long as that interpretation is reasonable. 3 As has been suggested, this two-step test can be boiled down to the rule that federal courts must respect any reasonable interpretation by an administrative agency of its own statute. 4

Appeal and supreme courts

“…The second approach, which adapts the framework of Ferejohn and Shipan (1990) and has been employed by Schwartz (1992), Cohen and Spitzer (1994) and McNollgast (1995), assumes that the Supreme Court has preferences over a two-dimensional space. One dimension remains the policy space in the original political model.…”

“…Thus, Cohen and Spitzer (1994) argue that the amount of discretion is a function of the ideological alignment of the Supreme Court relative to other political actors. McNollgast (1995) prove that, as the number of cases in a particular area increases, the amount of discretion granted lower courts never decreases and it may increase.…”

“…To enforce its views the Supreme Court must both induce lower courts to adhere to its "doctrine" and avoid reversal through legislation. McNollgast extend the model of Cohen and Spitzer (1994). They consider a three-stage game in which the Supreme Court fi rst identifi es the range of acceptable decisions in policy space.…”

“…They then test their model on data from the United States National Labor Relations Board and subsequent review. Cohen and Spitzer (1994) apply this political model to the analysis of the eff ects of another Supreme Court decision, Chevron USA Inc. v Natural Resources Defense Council Inc, 467 US 837 (1984), which required courts to grant more deference to an administrative agency's own interpretation of statutes it implemented.…”

“…Contrary to Segal's fi nding, they concluded that the US Supreme Court was constrained in roughly one-third of its decisions in the 46 years under study. Smith (2007) studies empirically the model in Cohen and Spitzer (1994). Smith analyzed cases decided by the United States Supreme Court between 1969 and 1999.…”