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Policy Analysis

Policy Analysis. Opportunities and Challenges in Democratic Polities By Dr. David Weimer. Overview. What is policy analysis? What do professional policy analysts contribute? What roles can policy analysis play in democratic polities?. What is policy analysis?.

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Policy Analysis

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  1. Policy Analysis Opportunities and Challenges in Democratic Polities By Dr. David Weimer

  2. Overview • What is policy analysis? • What do professional policy analysts contribute? • What roles can policy analysis play in democratic polities?

  3. What is policy analysis? • Policy analysis as a professional activity is client-oriented advice relevant to public decisions and informed by social values. • Policy analysis has a simple framework – compare alternatives in terms of goals. • Goals/Alternatives matrices provide visual display of framework.

  4. Goals/Alternatives Matrix

  5. Just Rational Decision Making!

  6. Avoiding Mistakes • Make alternatives specific – model as well as make. • Start with broad goals that cover relevant values – safety rather than side air bags. • Predict and value each alternative in terms of all the goals. • Expect tradeoffs! • Have real alternatives – BMW really possible?

  7. What Do Policy Analysts Contribute? • Filling cells of matrix: use social science and other skills to make predictions and valuations • Adding columns to matrix: design policy alternatives • Adding rows to matrix: provide arguments for inclusion of goals reflecting full range of social values

  8. Filling Cells:Applying Social Science Skills • Sophistication of prediction and valuation depends on available time, data, and skills • Draws on research methods: economic and mathematical modeling, statistics, program evaluation, case studies • Draws on research findings: relationships, parameters, elasticities • Grows with disciplinary research (example: contingent valuation surveys)

  9. Taiwan’s Fourth Nuclear Power Plant • Environmental impacts • Life-cycle assessment from fuel to waste • Comparison with alternatives • Economic impacts • Projected electricity demands at various prices • Reliability of power supply • Identification of sunk costs • National security • Vulnerability to blockade • Vulnerability of facilities

  10. Adding Columns:Designing Alternatives • Borrowing and tinkering • Institutional design: Creating rules and incentives to promote desirable outcomes • Monitoring casino gambling in British Columbia • Using simultaneous multi-round auctions to allocate broadcast spectrum in U.S.

  11. Modifying the Nuclear Power Plant Alternative • Reducing political opposition • Compensation for nearby residents • Greater investment in emergency response • More participation by environmental groups in planning process • Dealing with disposal issue • Contracting with foreign government • Simultaneous investment in technology to reduce storage risks during intermediate period

  12. Adding Rows:Instrumental and Substantive Values • Instrumental values: • Administrative feasibility • Political feasibility • Substantive values: • Diffuse interests • Silent voices

  13. Political Feasibility Two extremes: • Demand immediate political feasibility – only recommend those alternatives that are certain to be accepted politically • Ignore immediate political feasibility – only recommend those alternative that are desirable in terms of substantive values

  14. Case for Not Always Demanding Immediate Political Feasibility • Guano Theory • May be cumulative effect over time • Example: U.S. airline deregulation • Limestone Theory • Ideas may reappear at unexpected times • Example: Ronald Coase’s 1959 proposal for spectrum auctions

  15. Substantive Values in Representative Governments • Monitoring representatives is costly • Returns to monitoring vary: • Higher for concentrated rather then diffuse interests • Higher for organized rather than unorganized interests • Electoral incentives favor: • Concentrated over diffuse interests • Organized over unorganized constituencies • Hidden over visible costs • Current over future benefits; future over current costs

  16. Speaking for Diffuse Interests • Raising economic efficiency as a goal often corresponds to speaking for diffuse interests • Takes account of small gains accruing to those participating in markets • Distinguishes between transfers and gains from trade • Not always adequate – explicit attention to distribution needed

  17. Speaking for Silent Losers • Some may not anticipate being losers • Those who move to city with rent controls • Some may not know they are losers • Those who lose jobs because of price controls • Some may not yet be born • Future generations who will live with the consequences of long lasting policies

  18. How Can the Benefits of Policy Analysis Be Realized? • Support some “politically neutral” analytical organizations • Induce supply of and demand for analysis • Promote professional norms for policy analysts

  19. Analytical Organizations • Must have incentive to establish credibility: Legislature as client may work best • Start with narrow scopes where technical skills are relatively valuable • Emphasize prediction rather than recommendation • Examples: California Legislative Analyst’s Office; U.S. Congressional Budget Office

  20. Expanding the Role of Analysis • Make analysis a routine requirement • U.S.: environmental impact statements, regulatory cost analysis • ROC: Environmental Impact Assessment Act • Make analysis public and invite public participation • Require analyses to be posted on Internet • Allow interested parties to post comments

  21. Promote Professional Norms • Increase graduate training in policy analysis • Support Shih Hsin University’s efforts to strengthen graduate training in policy analysis • Encourage greater integration of policy analysis into public administration curriculum • Send more students to study in U.S. public policy programs (Especially at the University of Wisconsin!) • Join international organizations for promoting policy analysis such as the Association for Public Policy Analysis and Management

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