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Searching for Good Policies

Published online by Cambridge University Press:  01 November 2011

STEVEN CALLANDER*
Affiliation:
Stanford University
*
Steven Callander is Associate Professor of Political Economy, Graduate School of Business, Stanford University, Knight Management Center, 655 Knight Way, Stanford, CA 94305 (sjc@gsb.stanford.edu).

Abstract

Policymaking is hard. Policymakers typically have imperfect information about which policies produce which outcomes, and they are left with little choice but to fumble their way through the policy space via a trial-and-error process. This raises a question at the heart of democracy: Do democratic systems identify good policies? To answer this question I introduce a novel model of policymaking in complex environments. I show that good policies are often but not always found and I identify the possibility of policymaking getting stuck at outcomes that are arbitrarily bad. Notably, policy stickiness occurs in the model even in the absence of institutional constraints. This raises the question of how institutions and the political environment impact experimentation and learning. I show how a simple political friction—uncertainty over voter preferences—interacts with political competition and policy uncertainty in a subtle way that, surprisingly, improves the quality of policymaking over time.

Type
Research Article
Copyright
Copyright © American Political Science Association 2011

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