Xia Li
In the lead Precis, scholar Amanda Porter applies the path dependency model and the policy feedback theory to explain how public policy reshapes the political world in different ways and why we have been stuck in a path full of devastating consequences with no return, especially in the field of climate change. She further brings forward two stimulating questions regarding the possibilities to make large scale policy changes and the impairment to public policy process due to a lack of interdisciplinary engagement. The issue of carbon dioxide emission raised by Porter indicates how policy analysts can play an important role in determining the political decisions and lead to certain economic & social consequences. In this precis, I will explain why we have gotten to this point in the climate change from the lens of policy analyst’ role. I argue that the “evil” role played by policy analysts in climate change due to the very common but ineffective problem-solving tool – cost-benefit analysis (CBA) and the limits and institutional constraints faced by policy analysts. Finally, I will briefly discuss how the barriers between different disciplines lead to biased policy decisions and recommendations, as well as how the barriers can be broken down.
The “economics is solely about efficiency” ideology is very common in research about policy analysis. Munger in the chapter “Experts and “Advocacy”: The limits of Policy Analysis” points out that the job of the analyst is to try to move the working of the economy as nearly as possible toward efficiency. “The focus of much of “scientific” policy analysis really is efficiency to the exclusion of other concerns” (p 135). Although the efficiency paradigm has the advantage to centers all attention on Pareto optimality, which by construction is value natural, its limitations deserves equal attention. Munger identifies four basic problems with prices and market systems. (1) the unpredictable market system with extreme volatility in employment and prices will lead to social instability and even revolution; (2) the market system inevitably involves the exploitation of labor; (3) the prices do not accurately represent the scarcity value of resources; (4) the quantity of goods supplied will not always match up the effective demand of consumers. (p.138). The third problem explains well why CBA is not an effective tool in making public policy about environmental issues. From a purely efficiency-based view, relying on fossil fuels, at least in current days, is still the best way to maintain economic development and acquire a high return rate. Even though public analysts took some disadvantages of the use of fossil fuels into consideration and weight these disadvantages in policy analysis, there are still some consequences cannot be evaluated in price either because some cannot be measured or the long term effects cannot be detected. Therefore, only adopting cost-benefit approach in policy analysis is not sufficient to make wise policies.
While many policy analysts have realized the market failures, and call for an alternative form of economic organization – technical command economy where expertise can be a substitute for a price system as a mean of directing and valuing resources (145), they still face many limits and constraints that may restrain their abilities or even violate their own principles in policy analysis. To begin with, the conflicts between loyalty to the clients and loyalty to one’s own principles are always resolved in favor of the client because these are the people who control the funding and have the power to fire the analyst. Secondly, according to the Chicago view of regulation, concentrations of economic power can be translated into concentrations of political power (143). Therefore, the interest groups can influence the policy making process through the political power and put pressure on the policy analysts. Last but not least, the roles of the analyst are determined by the economic factors and political resources, as designed by Munger. How public analysis being carried out will depend on the context or particular institutional constraints within which the analyst is working. Hence, the “evil” part of policy analyst was not so much as a result of their own inability or immorality as the unavoidable product of the ill system.
Neither standard based or incentives based approach is good enough to solve the problems in the case of environmental regulation because they have both advantages and disadvantages. To come up with the most scientific solutions for climate change, in my opinion, the research in policy analysis should be improved from both internal perspective and external perspective. From internal perspective, policy analysts should use CBA as a decision tool, rather than a decision rule to aid in the process of public making and analyzing. Meanwhile they should also consider other policy analysis tools such as cost-effectiveness analysis, multi-criteria analysis, risk assessment and environmental impact assessment. From the external perspective, policy analysts should be set free from the political constraints and be supported with economic resources to work on the issues that matter to all of the people, such as fighting for climate change, basic human rights, poverty and inequality and so on.
No wonder that the single most important problem-solving tool in policy work is the CBA because most public analysts are economists. The education and training in the economic discipline is heavily about efficiency. To compensate for the drawbacks of the efficiency paradigm in public analysis, it is important to incorporate experts from other disciplines. Public policy and decisions involve issues from all aspects in life: economics can only answer part of these questions. In my opinion, there are at least two approaches to build the bridge between different disciplines. On one hand, the education and training of public policy major in higher institutions should encourage students from various backgrounds to apply and establish a high-quality interdisciplinary curriculum that represent alternative theoretical perspectives and research methodologies. On the other hand, the policy making process should include some conversations between economists and advocacy groups, sociologists, environmentalists, historians, anthropologists and scholars from other backgrounds with which values, ideas and concerns can be circulated and collected to achieve a comprehensive policy.
The “economics is solely about efficiency” ideology is very common in research about policy analysis. Munger in the chapter “Experts and “Advocacy”: The limits of Policy Analysis” points out that the job of the analyst is to try to move the working of the economy as nearly as possible toward efficiency. “The focus of much of “scientific” policy analysis really is efficiency to the exclusion of other concerns” (p 135). Although the efficiency paradigm has the advantage to centers all attention on Pareto optimality, which by construction is value natural, its limitations deserves equal attention. Munger identifies four basic problems with prices and market systems. (1) the unpredictable market system with extreme volatility in employment and prices will lead to social instability and even revolution; (2) the market system inevitably involves the exploitation of labor; (3) the prices do not accurately represent the scarcity value of resources; (4) the quantity of goods supplied will not always match up the effective demand of consumers. (p.138). The third problem explains well why CBA is not an effective tool in making public policy about environmental issues. From a purely efficiency-based view, relying on fossil fuels, at least in current days, is still the best way to maintain economic development and acquire a high return rate. Even though public analysts took some disadvantages of the use of fossil fuels into consideration and weight these disadvantages in policy analysis, there are still some consequences cannot be evaluated in price either because some cannot be measured or the long term effects cannot be detected. Therefore, only adopting cost-benefit approach in policy analysis is not sufficient to make wise policies.
While many policy analysts have realized the market failures, and call for an alternative form of economic organization – technical command economy where expertise can be a substitute for a price system as a mean of directing and valuing resources (145), they still face many limits and constraints that may restrain their abilities or even violate their own principles in policy analysis. To begin with, the conflicts between loyalty to the clients and loyalty to one’s own principles are always resolved in favor of the client because these are the people who control the funding and have the power to fire the analyst. Secondly, according to the Chicago view of regulation, concentrations of economic power can be translated into concentrations of political power (143). Therefore, the interest groups can influence the policy making process through the political power and put pressure on the policy analysts. Last but not least, the roles of the analyst are determined by the economic factors and political resources, as designed by Munger. How public analysis being carried out will depend on the context or particular institutional constraints within which the analyst is working. Hence, the “evil” part of policy analyst was not so much as a result of their own inability or immorality as the unavoidable product of the ill system.
Neither standard based or incentives based approach is good enough to solve the problems in the case of environmental regulation because they have both advantages and disadvantages. To come up with the most scientific solutions for climate change, in my opinion, the research in policy analysis should be improved from both internal perspective and external perspective. From internal perspective, policy analysts should use CBA as a decision tool, rather than a decision rule to aid in the process of public making and analyzing. Meanwhile they should also consider other policy analysis tools such as cost-effectiveness analysis, multi-criteria analysis, risk assessment and environmental impact assessment. From the external perspective, policy analysts should be set free from the political constraints and be supported with economic resources to work on the issues that matter to all of the people, such as fighting for climate change, basic human rights, poverty and inequality and so on.
No wonder that the single most important problem-solving tool in policy work is the CBA because most public analysts are economists. The education and training in the economic discipline is heavily about efficiency. To compensate for the drawbacks of the efficiency paradigm in public analysis, it is important to incorporate experts from other disciplines. Public policy and decisions involve issues from all aspects in life: economics can only answer part of these questions. In my opinion, there are at least two approaches to build the bridge between different disciplines. On one hand, the education and training of public policy major in higher institutions should encourage students from various backgrounds to apply and establish a high-quality interdisciplinary curriculum that represent alternative theoretical perspectives and research methodologies. On the other hand, the policy making process should include some conversations between economists and advocacy groups, sociologists, environmentalists, historians, anthropologists and scholars from other backgrounds with which values, ideas and concerns can be circulated and collected to achieve a comprehensive policy.