policy 210 final

value disagreements

people working on a policy might not be focusing on the same values

opposite: opinion policy congruence

empiricial evidence

evidence based on scientific research

based on observation or experience, able to be verified

normative

relating to or determining standards; a "should" thing

heuristic

a rule-of-thumb problem-solving strategy

positive externalities

when something by complete accident creates a benefit to society

negative externalities

when something creates a negative impact

coalition government

a combination of political parties that govern the area

implemented mostly when countries have more than 2 political parties

direct democracy

when individuals have a direct link to the democratic institution in charge of them

referendums!

real figures

data and statistics that have been adjusted for inflation

nominal figures

not adjusted for inflation

per capita figures

figures that are specifically addressed for each individual

per capita GDP, per capita growth rate, etc

indicator

tools used to quantify and evaluate outcomes or performance

test scores, life expectancy, GDP

index

a combination of indicators

Human Development Index (Bhutan)

mean

the average

median

the middle value in an ordered list

standard deviation

the measure of the deviation from the mean

perverse incentive

the unintended consequences of an incentive

human capital

the value of a human life and contributions

productivity

getting the most inputs for the smallest amount of outputs

higher productivity means a higher quality of life

pigouvian tax

a tax that brings the benefit up to the cost

cost benefit analysis

taking into account the cost and then the benefits of a policy option and evaluating it thoroughly

process by which the benefits of a project are tallied up and compared with the costs

cost-effectiveness analysis

a type of evaluation research that compares program costs with actual program outcomes

ranks policies based on costs for achieving some defined objective

value of statistical life

how much money should be assigned to a value of a life

changes depending on industry, stage of life, etc.

institutions

stable, long lasting organizations that help to turn political ideas into policy

laws, organizations, and unwritten rules that make public policy better

public institutions

have the capacity to design/operate/enforce consistent policies

the policy process

identify a social goal

problem diagnosis

identify the institution for action

evaluate options

implement and monitor

redistributive policy

policy that moves wealth that has been distributed unevenly back to where it is even

distributional effects

impact of a policy change on different groups

distributive policy

provide goods and services to the majority with taxpayer money

regulatory policy

encourage some behaviors and discourage others

constituent policy

creation and running of government agencies

institutions!

market failures

when goods and services are not distributed equitably and efficient

reasons for market failures

public goods are non exclusive

externalities

natural monopolies

information asymmetry

goal of public policy

defend people and property while keeping order

support/make effective non-governmental actors

promote thriving

collective-action problems

each individual is acting rationally but the outcome is bad, creating collective irrationality

sheep pasture and open fishing

using up common pool resources

TRAGEDY OF THE COMMONS

pareto-efficient

when changing allocation is not able to make any individual better without making one worse off

deadweight loss

when the loss of welfare to 1 party is greater than the gain by another - i.e. it doesn't make any sense to do this

principal agent problems

1 party, "principle" expects another party with different motivations, the agent, to act in a way consistent with the principal's goals but doesn't monitor their behavior

dominant strategy

what will produce the best outcome for them - the one that people will turn to most often

absolute figure

present in a unit of measure

relative figure

proportion of another quantity - relative to another value

percentage chance

extent to which a value has changed relative to the original

new - old / old

percentage point change

75% to 50% - 25 percentage point decrease

opportunity cost

what you have to give up to get what you want

positive analysis

analysis on data sans opinions

normative analysis

analysis on what should be done - best practices memo

constitutional actors

representatives of unique populations in govt

regional (House), state (Senate), national (President)

bureaucracy

non elected people responsible for carrying out policies

stages model of public policy

problem ID

agenda setting

formulation

legitimation

implementation

evaluation

will not necessarily be linear or in that order

models

simplified explanations of how things work

often can't model complexity

a very common one is supply and demand

utility

the public policy term for units of well-being, units of utility

moral hazard

individuals/firms are protected so they act with less caution and make a bad outcome more likely

adverse selection

individuals use private information to put themselves in or out of a market transaction

coase theorem

externalities will be corrected by the market if:

1) property rights are clearly defined

2) transaction costs are low

earmarks

mechanism by which members of congress insert money into projects

Alaska's bridges to nowhere

logrolling

get their buddies to support a bill so that they can get it earmarked

plurality

person with the most votes wins (regardless of a majority)

arrow's theorem

3+ options being considered, a collective decision cannot be made without violating:

1) unrestricted domain

2) completeness

3) transisvity

4) pareto optimality

5) nondictatorship

6) independence of irrelevant alternatives

gatekeepers

usually committee chairs - can make or break bills

rent-seeking

when political interests use govt power to get an economic advantage

economic rent

benefit can get erased by competition

marginal cost

cost of producing one additional unit of a good or service

marginal sale

the market price = benefit to the consumer

market equilibrium

where marginal costs = marginal benefits

optimal product prices

social marginal cost = social marginal benefit

public goods

nonrival and nonexclusive

variance

how far data points lie from the mean

standard deviation is the square root of the variance

68-95-99.7 rule (central limit theorem)

confidence interval

likelihood that the population mean lies within a certain distance of the sample mean

95%, 99%: common levels of confidence

future value

a value that a sum will grow to with interest

present discounted value

using the discount rate to bring a future projected value down to current times' values

market system

when sellers and buyers agree on transaction terms

central planning

when the govt is in charge of handling everything - hard to udo and goes sour fast

elasticity

how much supply and demand will change in response to a change in price

inelastic: if it doesn't change

sensitivity analysis is very similar

marginal product of labor

incremental output produced by 1 additional 'unit' of labor

absolute advantage

they are better at doing something than others

comparative advantage

when an entity has the lowest opportunity cost of producing that good or service

stratified sampling

a variation of random sampling; the population is divided into subgroups and weighted, taking SRS of each strata

cluster sampling

divide into clusters and take all of the people from that cluster

type 1 error

null hypothesis is rejected when true

type 2 error

null hypothesis is accepted when it is false

agenda universe

all of the possible topics for discussion

systemic agenda

topics currently on the minds and discussion of policymakers

institutional agenda

issues actually up for consideration

a bill and committee have been created

decision agenda

actively making a plan to vote on it

problem stream

tells us something is wrong

relies on indicators (extreme fluctuation indicates a problem)

policy stream

proposals developed to solve an issue

political stream

change in electoral/public opinion leads to reform

focusing events

sudden and rare events that draw media and public attention to harm

economic cost/benefit

direct tangible gain or loss (pecuniary)

noneconomic cost/benefit

intangible gain or loss

use value

the way that a product/commodity can be used directly - recreation, commercial purposes

nonuse value

intangible - attach value to a resource

willingness to pay

the price of something should be around the price that consumers are willing to pay for it

hedonic market analysis

uses regression analysis to isolate the value of a cost/benefit

policy design

process by which policies are designed through technical analysis and the political process

equity

redistributive policies that move resources equitably

efficiency

get the biggest bang for your buck

rational comprehensive model

considers all options, does a CBA, chooses wisely

incrementalism

policies are formulated to continue previous or make only gradual changes over time

garbage-can model

decision making is irrational + uncertain - conflict over goals and ambitions

throw a bunch of stuff at the wall and see what sticks