Public Policy

Lecture 9

​

The process of

Public Policy making

Public Policy making steps and stages

1. problem emergence (perception of the problem by the society)
2. agenda setting and building (plan)
3. consideration of policy options, formulation
4. decision making, adoption (by the Government)
5. implementation (put into practice)
6. evaluation (results)
7. termination

​

1. Problem emergence (perception of the problem by the society)

• In the past the process of policy began with newspapers: the journalists and major newspapers owners played a key role, along with the government, because were able to influence the public opinion and the crowd mood
• Later, a large number of policy analytics worked for the government. They decided which issue should be given a priority. Now they are mostly needed in large corporations for strategic planning, because they are trained to analyze the problem.
• In the US, policy is usually developed by a team of specialists from different fields - the more the better, because it shows that all aspects of the problem have been considered.

PP is a blend of law, engineering and accounting (as well as anthropology, sociology, etc.) Thus, a lot of people are involved in the public policy process.

Invisible people: Ethiopia case

“Public Policy refers to laws, government actions, funding priorities, and regulations that reflect certain positions, views, cultural ideals, or generally accepted rules”.

​

15% of the world's population live with a disability (1 in 7 people)

80% of these people live in developing countries.

​

In Ethiopia, about 15 million people (17.6% of the population) live with a disability (2016). Among them, more than half are children (about 8.2 million).

3% of children with disabilities go to school (85% of children without disabilities are enrolled).

Poverty and lack of special programs. Is it so?

Not at all:

The main socio-economic determinants of children with disabilities are:

• the stigmatization of parents and society,
• the wrong attitude towards disability and
• rigid pedagogical practices.

The lack of public understanding leads to ignorance about the number and status of disabled people - they are hidden from the census because parents and relatives consider them a sin, shame and disgrace to the family. They are hidden, concealed in unbearable conditions.

Policy recommendation: Intensive community-based advocacy is needed to improve awareness about disability. The government should ensure that the issue of disability is integrated into all aspects of labor policy and legislation, and that existing disability laws and policies are effectively implemented and enforced.

2. Agenda setting and building (plan)

Informative

function

Recommendative

function

developing

developed

Case of Ghana

Until 2007, when rich crude oil fields were discovered, Ghana was known only as an exporter of cocoa and timber.

Since then, Ghana's economy has gained a high growth rate, potentially becoming the leading economy in Africa.

The people of Ghana assumed that their living conditions and standards would improve as a result of the oil discovery.

People expected increased funding for new policy initiatives, investment in education, health care and infrastructure, creation of additional jobs and unemployment reduction.

But what did they get?

Ghana new policy initiatives “results”

1. "A 1% increase in fuel prices leads to an increase in the prices of goods and services by more than 1%." This significantly raises both the consumer price index and the producer price index, thus contributing to high inflation rates.

2. Ghana's GDP is still heavily dependent on agriculture due to low level of human capital.

3. Companies do not hire Ghanaians because they do not have the necessary qualifications. Education system is not effective because of inflation.

4. Oil production has caused significant damage to the fishery

5. The cities along the coast have indeed seen an improvement in the quality of life because they attract a large number of foreign workers, but not the cities located in the north of the country.

​

Policy recommendation: reject the accepted policy model copied from developed countries (leading to Dutch disease) and use different agenda setting, suitable for developing countries (targeting the roots of the problem)

3. Consideration of policy options, formulation

Policy formulation means producing an approach to solving a problem.

Since there are many parties involved in the process: Congress, the executive branch, the courts, and interest groups, conflicting proposals are often made.

The President or the leading party may have one approach to immigration reform, while opposition members of Congress may have another.

At this stage, forecasts are made about the results of the new Policy.

Northern Ghana case: warehouses

Of 2.5 billion farmers in the world, 1.5 are smallholders: cultivate less than 5-10 Acres and rely on crops for income and consumption.

There is 60% of Ghana farmers are smallholders.

Risks: yield fluctuations, price volatility, poor storage capacity

Problems: Excess crop diversification, limited technology adoption due to no investment and absence of savings or credit

Solution: Warehouse Receipt Program:

• Warehouse where farmers can securely store their crops and standardize the quality of the product
• Warehousing helps to accumulate large quantities of goods and delay the sale time for better price
• Attracts network of international buyers to local farmers (better prices)
• Provide Farmers with Receipt for collateral (deposit) for bank credits

4. Decision making, adoption (by the Government)

Poverty related Public Policy, especially in developing countries, is established by the government of the country, but implemented and carried out by nonprofit and private organizations

All parties involved have different goals and interests, so the policy must meet their requirements. For this purpose we must know the actors of decision making.

We must convince the reader that:

​

• problem worthy of attention
• the problem is solvable
• goals are realistic
• solutions are feasible
• methods are reasonable
• results are achievable
• the consequences are favorable
• perspectives are bright

Guatemala case: government indifference

Poverty in Guatemala is disproportionately high (60%) for the country with the largest economy in Central America

The country lacks a policy to improve the situation of the country's indigenous population (40% of population) by improving the health and education. The indigenous population, which suffers disproportionately from poverty and malnutrition ( up to 80% in extreme poverty).

Problems: inequality, malnutrition (especially children, 47%), lack of accessible and affordable health care and education

This is the result of short-sighted policies and misallocation of public resources: the government has neglected the most vulnerable groups of the population

Policy recommendation: Policy must aim at the root of the issues, rather than channeling all resources towards short-run growth

5. Implementation (put into practice)

This stage is extremely time demanding! Even in US.

Successful implementation depends on the complexity of the policy, coordination between those putting the policy into effect, and compliance.

The Supreme Court's decision in Brown v. Board of Education (1952-54):

In this milestone decision, the Supreme Court ruled that separating children in public schools on the basis of race was unconstitutional.

It meant the end of legalized racial segregation in the schools of the United States, overruling the "separate but equal" principle set in the 1896 Plessy v. Ferguson case.

However the desegregation was a complex issue; nobody provided any guidance on how to implement it. The implementation depended upon court judges local/state school board members who were often unwilling to push social change.

Colombia case: youth unemployment

Colombia has long history of violence, drug cartel power, conflict involving paramilitary and guerrilla groups

Youth Unemployment (ages 15-24): 18.06% (vs 9.3% in general)

Adopted policy: “Guarantee for Youth” - the program implies that young people up to 24 years, who are not employed for a period of four months after the end of formal education or after the loss of a job, are offered alternative work, further education or practice.

However, the implementation of the policy has been frozen due to the adoption of an “anti-discrimination” program for the older people, and youth unemployment has only increased over time.

​

The result is a high involvement of young people in illegal and underground activities.

6. Evaluation (results)

​

​

​

Evaluation means determining how well a policy is working

Typically the cost-benefit analysis is used, and it is not an easy task:

Cost-benefit analysis is based on hard-to-come-by data that are subject to different, and sometimes contradictory, interpretations.

If the government is spending X billions of dollars on this policy, are the benefits derived from it worth the expenditure?

​

Evaluation is extremely costly and time demanding!

​

This stage is difficult for Poverty related PP, because it does not require any direct profit

​

​

​

Ruanda case: aid dependency

Ethnic violence has defined the history of Rwanda with an ethnic composition of 90% Hutu, 8% Tutsi. Their conflict led to the genocide in Rwanda in 1994. With over 800,000 dead, 150,000 children were orphaned and over 2 million fleeing or displaced, the genocide reduced Rwanda's population by over 10%

The country was economically devastated, so an immense amount of foreign aid attempted to assist in the process of recovery. As foreign aid flooded the country post-genocide, the number of countries and organizations that remain assisting Rwanda remains high and does not allow Rwanda to develop. The evaluation was made in 2011, 17 years after the policy adoption.

Many economists believe that the reliance on foreign aid worsens the situation: this has created a culture of dependency amongst the population of Rwanda and only increases inflation. The situation is similar to Kenya's health care system's dependence on donors.

Policy recommendations for Rwanda

Change of priorities: instead of foreign aid focusing on health and population, there needs to be an emphasis on local innovation and entrepreneurial activity that can eventually lead to more domestic investments and savings.

Positive example - AusAID program: “help people overcome poverty… and make sense for business engagement activities to be embedded within existing programs.”

Goal:“Sustainable economic development, achieved by improving food security, increasing incomes, employment and enterprise opportunities ”

• private sector and local economic development,
• making markets work for the poor,
• value chain development (finding the right distribution of labour and responsibilities between local and central activities),
• inclusive business (facilitating and fostering economically vulnerable people’s participation in economic life)

​

7. Termination

History has shown that once implemented, policies are difficult to terminate.

When they are terminated, it is usually because the policy became outdated, clearly did not work, or lost its support among the interest groups and elected officials that placed it on the agenda in the first place.

For example, in 1974 Congress enacted a national speed limit of 55 miles per hour. It was effective in reducing highway fatalities and gasoline consumption. On the other hand, the law increased costs for the trucking industry and was widely viewed as an unreasonable federal interference into an area that belonged to the states to regulate.

The law was cancelled in 1987.

​

Usually termination step requires a new policy, i.e. Termination policy.

In developing countries, the policy termination happens whenever there is a change in government and/or politics.

Political instability = policy termination

One of the most politically unstable countries is Zimbabwe with an inflation rate of 285% in August 2022. This makes any policy initiatives meaningless, since it is impossible to finance them.

Argentina is notorious for the lack of proper governance strategies and practices, high levels of corruption, hyperinflation, and the collapse of the banking sector in 2001-2002.

Its problems are related to political instability and frequent policy changes:

​

• Irresponsible public spending.
• High public
• Non-implementation of recommendations for overcoming the crisis
• Accepting but not following pegging currency requirements.
• Inefficient educational system (Low government spending)

Policy recommendation for Argentina

• Expansive fiscal policy is not recommended because it will raise interest rates

• Digitalization (which will help fight corruption.)

• Better educational system

• Create incentives for local Argentines to stay in the country.

• Fighting against corruption and minimising it.

• Consistent Fiscal Policy. (After lowering corruption levels.)

• Giving autonomy to the Argentinian Central Bank.

• Eventually dollarization.

However, most of these measures are designed for stable political situation, i.e. they are long term policies

A Practical Guide for Policy Analysis: The Eightfold Path to More Effective Problem Solving

• Eugene Bardach is professor of public policy at the University of California, Berkeley.

​

• This bestselling handbook presents dozens of concrete tips, interesting case studies, and step-by-step strategies for the budding analyst as well as the seasoned professional.

Step 1: Define the problem

Think of Deficits and Excesses

Make the Definition Evaluative

Quantify If Possible

Conditions That Cause Problems Are Also Problems

Missing an Opportunity Is a Problem

Avoid Pitfalls in Problem Definition:

• Defining the solution into the "problem":

Don't: "There is too little shelter for homeless families."

Do: "There are too many homeless families."

​

• Accepting too easily the causal claims implicit in diagnostic problem definitions:

Don’t: Drug using is a problem

Do: Consequences of drug using, like crime, poor health, family disintegration, are the problem

Do not rush to suggestions and conclusions - the reader must decide for himself

Semantic tips –

logical advice on how to use word expressions for argumentation

Step 2: Assemble Some Evidence

Think Before You Collect information

• The value of evidence
• The utility of educated guess.

Do a Literature Review

Survey "Best Practice“

Use analogy

Start early - this step is time demanding

Contact with people, gain credibility

• When your work requires contacts with potential critics of your work, you should be ready to answer their comments and take into consideration their perspectives.
• By making yourself known to potential supporters of your work, you may also be able to create a group of defenders and supporters.

Know your problem!

Step 3. Construct the Alternatives

alternatives there –

• "policy options,"
• "alternative courses of action,"
• "alternative strategies of intervention to solve or mitigate the problem."

​

Start Comprehensive, End Up Focused

• Always include the alternative: "what happens if the current trends remain intact."

​

Model the System in Which the Problem Is Located

Reduce and Simplify the List of Alternatives

Design Policy Alternatives - put them in order

Describe the potential ways for the solution

Step 4. Select the criteria

• Efficiency
• Equality, equity, fairness, justice
• Freedom, community
• Security

​

• Weighting conflicting evaluative criteria

​

• Legality
• Political acceptability
• Robustness and improvability

​

• Avoid confusing alternatives and criteria

Commodity used

evaluative criteria

Commodity used

practical criteria

Criteria: the bigger the better

Step 5. Project the Outcomes or impacts

• “Do it”: policy analysts tend to avoid this step, mostly because it require the realistic picture of the future and people prefer be optimistic about any new project
• Extend the logic of projection: model + evidence. You do not have evidence that it will work, but you do not have one that it won't.
• Magnitude estimates: be detailed
• Break-Even Estimates. This step helps take into account the uncertainty for decision making: you can (and should) be certain about costs, not outcomes….
• Sensitivity analysis: what uncertainties are most important
• Construct the outcomes matrix: it will be used for DM.

Silly matrix is always better than no matrix

Step 6. Confront the trade-offs

• If the new policy includes groups with different interests, you will not be able to achieve your goals in full. You must find a compromise.
• You have to gather maximum available info about possible goals involved and rank them – it helps find dominant strategies among alternatives
• Always remember about triangle of sacrifices in DM – you never get fast, easy and effective solution without large budget.
• There is plenty formal methods how to find solution for trade-offs. However remember, that you always find the solution for the model you built, not the problem. So if you are interested to find certain solution as a result – build your model accordingly

​

• Without Projecting Outcomes, There's Nothing to Trade Off

​

• A common mistake in confronting trade-offs is to think of the tradeoffs as being across alternatives rather than across projected outcomes

Step 7. Decide

• ‘Decide’ here is a step, when you have to check if your result is convincing enough:
• Think of it this way: Unless you can convince yourself the plausibility of some course of action, you probably won't be able to convince your client-and rightly so.
• The Twenty-Dollar-Bill Test: old joke about a bill on the floor “It couldn’t be a real money. If it were, somebody would have picked it up already."

​

• The analogy is this: if your favorite political alternative is such a great idea, why hasn't it been implemented yet?

​

• The most common sources of failure in this test are ignoring the resistance of bureaucratic and other participants, as well as the lack of an entrepreneurial vision of politics as a great idea for business.

Step 8. Tell your story

• This step is about delivering the results of your work to the end user.
• A little reality check: The New York Taxi Driver Test
• Suppose you have just caught a taxi in New York. While you are stuck in traffic, the taxi driver asks you about your job. You say that you are a policy maker and you have been working on a specific problem. He asks, "So what's the solution?" You have one minute to offer a clear, simple explanation before he accuses you of being a pointy-headed intellectual. The answer should be short and quick.
• Ernest Rutherford. A theory that you can't explain to a barmen is probably no damn good.

​

• Three stages of the recognition of scientific truth: the first - “this is absurd”, the second - “there is something in it,” the third - “it is well known”

​

Tips for policy process in another country

• The global change should be preceded by small movements.
• It is usually too hard to change something really big. Divide the problem and start with small and simple
• Talk about the problem! Make it wide known and recognizable.
• Many difficult subjects tend to be silent in the society, but ones spoken it is easier to solve
• The new policy have to be or become part of local culture
• The initiator must be local activist. It is no good if regulation originated in foreign country.
• If the problem is not new, find similar cases in the past, even if they weren’t successful.
• If the problem is new and you have only foreign examples, underline the uniqueness of situation in your country and make stress on the fact, that other countries would use the positive experience of your country.

Summary

• Even though the process of Public Policy making is usually unique in every country, we can find similarities and use the experience of others.
• The first task in the process of Public Policy making – to reveal the system, in which our problem is exists and prosper. As soon you truly understand causal relationship in any arrangement, you easily can expose the root of the problem and find the solution.
• Always respect people who will deal with your policy at all steps: they have to realize that they make important, needed and worthy work. For this purpose, your project mustn’t teach anybody how to live but bring over to your side. This is especially true for modern innovations

Next time

We will build the Model of reasoning for every project

​

Please be ready, make a draft - you will present it in class on the blackboard

The model of reasoning – is a rational part of DM�What is first? What is consequences?�

• 1. Identify objectives
• 2. Identify alternatives of actions for the achieving objectives
• 3. Predict the possible consequences of each alternative
• 4. Evaluate the possible consequences of each alternative
• 5. Select the best alternative (max)

​

• This model usually related to model of Political reasoning

Model of reasoning: How to

• Place your problem in the center
• At the left side place all reasons (inputs)
• At the right side – outputs, consequences and final costs of the problem

​

• Sometimes the inputs are the continuation of outputs, so it will be a cycle.
• Outputs and inputs themselves could have own intuits and outputs
• Poverty has to be one of reasons and/or consequences

Example 1. Unemployment reasoning model (India)

Example 2

Example 3. Youth unemployment.

Caribbean.

Cycle of poverty

​

Model of reasoning

​

Poverty cycles

Poverty and Education of Children with Disability. Case of Public Policy Issues in Ethiopia

• The problem: only 29.27% of Children with disability attending school programs.

​

Model of reasoning for education issues in Vietnam

The problem: 60% of youth (ages 15-24) are not completing the secondary school

Model of reasoning for inequality in Guatemala

Model of reasoning for Rwanda Aid dependency

Model of reasoning for Ethiopian ublic policy issues