The modes and intensity of market interventions are central topics in research and in policy debates on regulation and governance worldwide. Lately, initiatives on good governance, better regulation and evidence-based policy-making have given rise to major questions about the choice between available governance mechanisms. Research and policy typically suggest due consideration of alternative modes of governance like self- and co-regulation, but rarely specify the criteria against which the suitability of different options should be scrutinized and compared. This chapter introduces a governance-choice method that has been developed to support researchers and policy-makers who are confronted with the task of defining the appropriate role of the state in governance arrangements, the right mix of public and private contributions to governance challenges. This institutional approach provides a set of interlinked organizational factors and enabling contextual criteria that make it possible to predict the performance of a planned alternative governance arrangement and to assess the performance of an established one. The chapter presents an outline of the governance-choice method and illustrates its application with two examples: content rating in the audiovisual sector and the prevention of spam on the Internet.