give for nonexpert readers a good picture of the way science works. .... Wrong theories are not an impediment to the progress of science. They are a central part of the struggle. .... The five chief characters in Livio’s drama are Charles Darwin, William Thomson (Lord Kelvin), Linus Pauling, Fred Hoyle, and Albert Einstein. Each of them made major contributions to the understanding of nature, and each believed firmly in a theory that turned out to be wrong..... [W]rong ideas can be helpful or unhelpful to the search for truth. No matter whether wrong ideas are helpful or unhelpful, they are in any case unavoidable. The case for blunders, Freeman Dyson, 'New York Review of Books' dated 6 MarchEven more so in social policy, where underlying relationships change over time and are rarely independent of the psychic makeup of the principal actors and stakeholders. We need to encourage diverse approaches to our social problems, and ones that can adapt when they are seen to be inefficient or counter-productive. As with science, though, social policy practitioners, be they politicians, bureaucrats, academics or members of think-tanks, frequebtly commit their egoes - and public funds - to deficient theories or ideologies.
The chief difference between science and other human enterprises such as warfare and politics is that brilliant blunders in science are less costly.Quite: when great scientists commit themselves to wrong ideas the costs can be high, but when politicians do so they can be calamitous.
Social Policy Bonds would penalise failed or inefficient pseudo-solutions to our social problems, and reward only the most cost-effective ways of achieving our social goals. Bondholders would be motivated to terminate failing projects and divert funds into only the ones that are cost effective. If they don't do this quickly enough, others would bid more for the bonds than they are worth to the current holders. The bonds, being tradeable, would always be in the hands of people who are motivated to be efficient. Commitment to wrong theories would be penalised in immediate, pecuniary ways - a stark contrast with the current policymaking system, within which failed policies, instead of being terminated, often receive more and more funding in an effort to shore up vested interests.