---
id: "concept-regulatory-taxonomy"
type: "concept"
source_timestamps: ["§ Invest in trust-building institutions and a \\\\\\\"regulation taxonomy\\\\\\\" for multiple markets."]
tags: ["governance", "compliance", "strategy"]
related: ["action-classify-regulatory-logic", "concept-digital-sovereignty", "quote-china-regulatory-policy", "entity-new-delhi-declaration"]
definition: "A method of classifying global markets based on their regulatory logic—permissive, precautionary, state-directed, or hybrid—to navigate a fragmented compliance landscape."
sources: ["futures"]
sourceVaultSlug: "hbr-seg-futures"
originDay: 2
articleStem: "hbr-foci-75-fragmenting-digital-economy"
sourceUrl: "https://hbr.org/2026/06/what-a-fragmenting-digital-economy-means-for-global-competition"
sourceTitle: "What a Fragmenting Digital Economy Means for Global Competition"
---
# Regulatory Taxonomy

A **Regulatory Taxonomy** is the strategic framework the authors prescribe for navigating the fragmenting digital economy. Because a harmonized global technology stack is no longer viable, leaders must classify markets not only by growth but by their underlying **regulatory logic**. The four primary logics:

1. **Permissive** — e.g., the U.S. federal approach ([[concept-the-leaders]]).
2. **Precautionary** — e.g., the EU / [[concept-stall-outs]] regulations.
3. **State-directed** — e.g., China's *"move fast but obey the rules"* ([[quote-china-regulatory-policy]]).
4. **Hybrid** — e.g., [[concept-break-outs]] economies borrowing from multiple models; see the emerging Global South bloc via [[entity-new-delhi-declaration]].

This pairs with [[concept-digital-sovereignty]] and is operationalized in [[action-classify-regulatory-logic]].


## Related across articles
- [[concept-regulatory-sandboxes]]
- [[contrarian-regulation-as-catalyst]]