19 February 2012

Should evidence determine policy?

There seems little to choose between evidence-based policy-making and policy-based evidence-making. See this discussion: "the idea that we've moved from ideology-based policy-making to evidence-based policy-making...is completely misleading, because the evidence-gathering process is itself value-laden." Life is so rich and complex, and the stakes so high, that so-called experts will always be able to find evidence that justifies whichever policies serve the interests of the highest bidder. So my answer to the question in my header is: no. And my suggestion is just as simple: outcome-based policy. Link

18 February 2012

Emissions trading not working - who would have thought it?

No surprises here:
Emissions trading, the European Union hoped, would limit the release of harmful greenhouse gases. But it isn't working. The price for emissions certificates has plunged, a development that is actually making coal more attractive than renewable energy Source
Here's another idea: instead of using fossilised science, and then allowing corporate interests and their friends in government to dictate policy, why not target the outcome that we want to achieve? A more stable climate, defined in terms of some combination of human, animal or plant health indicators. And why not reward people for achieving this outcome, rather than for performing some activities that might, but actually don't, achieve it. See here for more.

10 February 2012

Bad Policymaking

Ben Goldacre writes:
[F]or ... assessing causal relationships, intuitions are often completely wrong, because they rely on shortcuts which have arisen as handy ways to solve complex cognitive problems rapidly, but at a cost of inaccuracies, misfires and oversensitivity. Bad Science, Ben Goldacre (page 238)
This becomes a problem for policymaking under the current system, where government is often charged with identifying causal relationships and, if it gets them wrong, the consequences can be calamitous. For murky, complex social, economic and ecological relationships, we need a mechanism other than the one-size-fits-all, top-down approach that is a feature of the current policymaking system (and which can work well, when causal relationships are obvious). Central planning, a catastrophic failure when applied to economies, fails too in policy areas where there is a compelling need for diverse, adaptive approaches.

But central planning is precisely the approach we are taking in tackling extremely complex social and environmental problems: climate change, or warfare, for instance. They seem to be failing in much the same way as in the economy. There's little response to expanding knowledge or to changing circumstances. There's little diversity. Most important, failed approaches aren't terminated. The incentives are to maintain existing institutions, rather than to achieve the stated outcome.

That's where Social Policy Bonds could be a better alternative. They would reward people only if a specified outcome is actually achieved and sustained. A body that issues the bonds doesn't have to have an opinion about what causes a social problem. It just has to reward the people who solve it. Incentives are built into the system: only efficient solutions will be rewarded.

For more about Social Policy Bonds, please download my book (see right-hand column).