Evidence-based policy is a buzzword that conjures up images of responsible government: difficult decisions taken after a careful examination of the evidence, tailored local experiments, and then implemented using the best advice available. Sounds good, no? As a buzzword, it is a clear winner and something we all want more of.
But how much can we really expect of this buzzword and what will it actually lead to? Let’s have a look at the dangers and benefits.
The dangers and limitations
The first thing to note about the buzzword is that its main association is with rational control. In order to have evidence based policy, you must gather evidence and have a policy process. That means hiring more bureaucrats to do the gathering and the processing. Hence the buzzword is first and foremost a means for a bureaucracy to get their hands on more resources.
The buzzword also works to legitimise more power to a centralised bureaucracy: if you are going to have evidence-based policy, you must be able to implement the centrally-decided policy. Hence it is an excuse to take independent decision-making power away from local actors to the benefit of a supposedly rational centre. One might note the inherent contradiction here: with less power to local actors comes less local experimentation, meaning less policies are tried out and less possibilities for learning. Evidence-based policy is hence an engineer’s view of how an organisation learns (top-down). An alternative view could be that an organisation learns by following successful examples within the own organisations, which is a more organic but far less ‘evidence-based’ view. One might not know why something works and have no evidence that it will work in other places, but by simply following previous successful examples one can nevertheless reasonable hope to improve over time. That is how evolution works (what accidentally happens to fit its environment gets to procreate) and how many markets work: not by a rational gathering and analysing of information but by an almost blind mimicry of accidental success.
These initial thoughts mean that adopting the word ‘evidence-based’ policy implies increased bureaucracy, increased centralised control, and decreased local experimentation.
Then, let us consider the limits of ‘evidence’. New events that have no clear precedent but to which one must react are clearly outside the scope of evidence. What is one supposed to do then, wait until evidence is gathered? For instance, the recent Global Financial Crisis had no clear known precedence. It only vaguely resembled previous recessions. Should this then mean that all kinds of policies that were not implemented before and for which there was no evidence should not have been implemented? Should there have been no fee for the bank guarantee? Should we have stopped migration? Should we have started government work programmes (which were deemed so successful during the Great depression)? Or should we have done nothing for 50 years during which we gather more evidence?
It is clear that in the case of new major shocks hence, evidence-based policy has no meaning. We react to these based on vague rules-of-thumb and a vague understanding of how the whole economic system behaves. Such vague knowledge, based on vague historical evidence, can hardly be called evidence-based, but it is all we have to go on in such situations.
Then, onto the plus side:
(Continued)