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Public Policy: Objectives and Principles Roger Kerr New Zealand Business Roundtable

Public Policy: Objectives and Principles Roger Kerr New Zealand Business Roundtable. “The framework of institutions, laws and programmes laid down by the arms of government (parliament, the executive and the judiciary) that regulate the economy and wider social interactions.”. Critical issue:

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Public Policy: Objectives and Principles Roger Kerr New Zealand Business Roundtable

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  1. Public Policy: Objectives and Principles Roger Kerr New Zealand Business Roundtable

  2. “The framework of institutions, laws and programmes laid down by the arms of government (parliament, the executive and the judiciary) that regulate the economy and wider social interactions.”

  3. Critical issue: The proper role of government

  4. IRELAND HONG KONG SINGAPORE

  5. Objective of public policy Human flourishing - not just about economy, monetary values, efficiency - encompasses fairness, environmental quality, freedom

  6. Ideological? • Should be evidence-based • Role of economics • Free trade, school choice, privatisation • Boundaries of political debate

  7. Common framework • Markets vs government • Invisible vs visible hand • Need governments to set rules of game

  8. Voluntary cooperation Market exchanges Politics/collective choice

  9. Voluntary cooperation Dominant means of getting what we want • Norm in families, small groups • Also clubs, associations, charities • Involves redistribution within families and through altruism • Works best in ‘face to face’ settings But can’t run a large society that way

  10. Market exchanges Essential for society at large • Gains from specialisation and trade • Prices - transmit information - coordinate plans - markets continuously adjust • Consumers’ interests paramount But - market failures

  11. Politics • Voting mechanism is imprecise - candidates, parties, electoral systems, accountability • Coercion- not mutual benefits, as with markets & voluntary cooperation • Tyrannies of majorities and minorities Political market failures

  12. Upshot? • No ideal yardstick • Political/government failures routine, not exceptional Must compare real-world alternatives

  13. In choosing among real world alternatives • Focus on incentives • Bias in favour of economic freedom Implies limited government

  14. How do we constrain government ?

  15. How do we constrain government ? Economic constitutions Sound processes • Compensation for Regulatory Takings • Taxpayer/Ratepayer Bills of Rights

  16. Public policy and business management • A country is not a company • National central planning doesn’t work • Different skill requirements • Problems with DIY economics

  17. Conclusions Good public policy: institutions that promote human flourishing • There is a significant role for government, • but • individuals need protection from government abuse • governments don’t necessarily act in the public interest • remedy of government intervention sometimes makes things worse

  18. The biggest public policy mistake: to expect too much of government The challenge: how to restrain government to what it does well

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