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Under alternatives, Bardach & Patashnik recommend analysts “model the system in which the problem
is located.” What types of models do they describe, and how do they work?
Market models: disaggregated suppliers exchange goods or services with disaggregated demanders that can apply to unpriced goods and services. Main idea: market model is really equilibration through exchange. Intervention strategy = find a way to lower the prices faced by either suppliers or demanders.
Production models: identify the parameters whose values, when they move out of a certain range, make the systems most vulnerable to breakdown, fraud and abuse, egregious diseconomies and the distortion of intended purpose. You can look at production models through optimization lenses, queuing, inventory management and Markov processes.
Conformity models: individuals adapt the attitudes and actions of other people around them. 3 sources of conformity: automatic mimicry and imitation, normative influence (doing what others do to increase social acceptance) and informational influence (a crowd). Ex: hotels have been able to significantly boost the percentage of guests who reuse bath towels by saying most people do it
Evolutionary models: common process of change over time. 3 subprocesses: variation among competitors, selection and retention. Ex: workers complain about problems are aren’t too prominent rather than problems that actually need to be addressed. The agency they work at might screen their complaints for their likelihood of being associated with more fruitful targets— changing the selection mechanism. Or attempt to persuade workers to reduce their willingness to complain about matters the agency doesn’t wish to hear about— changing the retention mechanism workers’ attitudes.
What features of human behavior make pricing roadway-use a possible solution to congestion?
The unwillingness to pay more for a good that they had for free or cheaper before— they are disincentivized to drive on toll roads. This incentivizes them to wake up earlier to avoid tolls or use a different road to avoid tolls which both in turn reduce traffic congestion.
What is a global oil-climate index supposed to accomplish, and what does it demonstrate relative to assembling some evidence?
The oil-climate index measures total life greenhouse gas emissions of individual oils which allows stakeholders to compare crudes and assess their climate consequences before development decisions are made. Policymakers can reference the global oil-climate index to reduce a crude oil’s climate impact by developing policies. While evidence like the index might be costly to produce at times, it might be worth it to pay the price to better understand the situation.
What are some alternatives and criteria which would be useful in an analysis designing new admission policies to replace affirmative action?
Holistic review: analyzing all students’ circumstances to better understand them : Class, geographic diversity, etc…
What market failure(s) or feature(s) are prominent in MBN’s “platform economy” chapter?
Network effect, which describes a consumer’s willingness to use a product or service dependent on others willing to use the same product or service is in play. With the network effect in place, other competitors that are not as popularized as the main platform are more susceptible to failing, as the market is distributed unequally— making it inefficient.
Why is ““Let present trends (or ‘business as usual’) continue undisturbed” an important alternative?
It is important to see if it is truly worth it to institute a new policy— be it worth it in terms of social outcome, economic reason, etc.. Are the trade offs worth it? Analyze benefits and drawbacks
Allows for a baseline comparison as other alternatives may lead to unexpected consequences
Why do Bardach & Patashnik recommend listing alternatives that may be “out of the box”?
Ideas that seem “out of the box” now may actually be the smartest solution; ie. ideas that were previously viewed as odd or impractical were greatly successful once implemented
Technological advancements and changing social norms may expand the number of potential solutions
Evaluating the criteria for each alternative is in the next step of the Eightfold Path, so no need to worry about its efficacy, feasibility, etc. at this step
Review Bardach & Patashnik on criteria of efficiency & equity. Then review the lecture-slide/handout on “Some Key Criteria To Consider.” What are four ways to apply the efficiency criterion, identified in the slide? What are three ways identified there to operationalize the equity criterion? How do these sub-categories of efficiency and equity differ? What are other social goals concerning efficiency and equity you think are important?
Efficiency: cost effectiveness and net benefits maximization
1. The alternative will add more benefit than cost 2. The alternative will add benefit at minimum added cost 3. The alternative will minimize waste of resources 4. The alternative will improve the allocation of benefits and burdens economically
Equity: fairness/justice; concerned with social situations and disparity.
1. The alternative will treat those affected evenhandedly 2. The alternative will take into account social disadvantage 3. The alternative will redistribute in a way which advances equality
Difference: efficiency is concerned with maximizing net benefits, given there are scarce resources, whereas equity is concerned with disturbing the benefits of goods and services equally with consideration of existing social disparities
Social goals of effectiveness and equity include making sure everyone in the market is taken care of at a sustainable, timely rate.
In “Alternative Approaches to Funding Highways, Congressional Budget Office” (Box I-5) specifically, how do efficiency and equity get applied, and what are the differences between them?
When considering taxing highways through fuel taxes, equity or fairness is applied by considering the share of funding that is obtained from taxes paid by highway users vs. general taxpayers, people in households that fall into different income categories, or people in rural vs urban households. Efficiency is applied by considering users’ travel behavior and what it costs to implement the policy.
Fuel taxes are not equitable since they impact the lower class and are bad for people in rural areas because they need to drive longer distances. However, fuel taxes are efficient since cost of enforcement is low and it is effective in disincentivizing highway usage
What are the strengths and weaknesses of pursuing “incrementalism” in policy analysis?
Strengths: Policymaking involves “the science of muddling through”, i.e., pursuing theoretically good ideas while attending to factors like politics. Opponents to radical change are likely to support incremental policies. In addition, if mistakes are made, harm is small and necessary adjustments can be made
Weaknesses: Incrementalism is ill suited for those who want immediate, fundamental reform; hard to garner support and excitement for relatively small changes
Review the hypothetical “Stylized Example: Congestion At The Airport” Slide and the criteria identified in that example (reduce delays, maintain safety, minimize added cost, honor union rules). If we add a criterion of “fairness to airline passengers,” how might fairness improvements be measured?
Criteria of fairness to airline passengers can be measured through flight prices (to see if the prices are uniform); the rate of flights that take off on time (to see if certain flights are more generally behind schedule, which would be unfair to those passengers)
What is the difference between the Pareto criterion and Kaldor-Hicks efficiency, and what is a good example of how the latter would work in practice?
Pareto criterion is applied to situations in which no action can make a person better-off without making another person worse off. Kaldor-Hicks efficiency is when you achieve Pareto optimality through subsidization of those who are worse off by those who are better off.
Based on the MBN chapter on aviation safety and Cooter & Ulen’s discussion of risk, should the FAA be risk-averse, risk-neutral or risk-inclined in its regulatory approach?
The FAA should be risk averse because the marginal benefit of safer travel is greater than the cost. It is dependent on circumstances because new technology makes it cheaper to be risk-averse. Sometimes cost isn’t worth the benefit like having an emergency door per row on a plane.
