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PUBPOL2300, Unit 5: Risk Regulation, UNIIT 2: POLICY ANALYSIS FRAMEWORK,…

- - - - states take care of marriage contacts; school attendance; child abuse; neglect
      - states used to experiment
    - - Very Restrictive: Earned Income tax credit
      - Restrictive: grants in aid
      - less restrictive: block grants
      - No restrictive: unrestrictive money to state; revenue sharing ;medicaid
  - - - What are its characteristics?
        
        Troubling condition
        
        appropriate for government action
        
        problem defined and articulated
        
        Possible to remedy the situation
    - - underlying causes not easy to diagnose: drug abuse, child abuse, discrimination
      - causality
      - invisability- hard to measure
      - Tractability- policy ineffective in addressing the problem
  - - - Top down: Top most officials do movements
      - Bottom Up: starting smaller to larger legislation
    - - designate ranking of agenda items, some more urgent like infrastructure; immigration less concerning
      - Public problem must be converted to issue requiring government attention
        
        Issues more likely to achieve agenda status:
        
        crisis proportions
        
        Particularity of issue- exemplify larger issues
        
        Emotive
        
        broad impacts of issue
        
        questions about power or legitimacy(gender wage gap)
        
        Topical- fashionable
      - Policy Window: window of opportunity exists for bipartisan support
        
        ex. 2022 July gun reform legislation
      - Maco level policy agenda set by political leadership
- - - - Material: policies involving actions to distribute resources to individuals and groups offering benefits/advantages (ex. highways; welfare checks)
        
        Collective: provided for all; national defense
        
        Private goods: benefits may be broken into units or distribution to individual users or beneficiaries
        
        How are material resources allocated?
        
        Distributive
        
        Using public funds; passed without challenge generally; produced by individual lobby
        
        Pork barrel: spending inserted into generally non related pieces of legislation as either award or incentive for political support to vote for a main bill
        Pork in the package: pork refers to benefits given to a specific population but cost is spread among all tax payers
        
        Redistributive: reallocation of money, rights, or power to another; highly contentious; difficult to pass or retain; ex. social security, welfare, tax policy
      - Procedural: regulations regarding products, groups, and businesses in society (ex. FAA regulations, FDA, FTC regulatory policies)
        
        How do policy makers regulate society through procedural policies?
        
        Regulatory Policy: impose limitations on behavior of individuals or groups within society; FDA, speed limit; Social Regulation/Airline Regulation/Electricity
        
        Symbolic Policies: these policies have little real impact on lives; appeal to values; highly contentious; ex. endangered species list, flag burning act
- - - - Why we fear things we shouldn't:
        
        turn adapive fear mechanism intto maladaptive panicked response
        
        Why is it a public policy problem?
        
        mental risk processing mechanisms are systematically biased in the wrong direction
        
        What are some characteristics of risk?
        
        more acceptable vs less acceptable:
        
        voluntary/involuntary
        
        immediate vs delayed
        
        risk certain/ unknown
- - - - absolute risk assessment- magnitude of risk
      - relative risk assessment: risk-ratios
        Incid of outcome w exposure / incidd of outcome w/o exposure
      - access the cost of averting risk through CBA
- - - - Challenges:
        
        complex problem
        
        definition changes
        
        objective not clear and highly ambiguous
    - - Set of STATEMENTS
    - - Legislative history- local, county, state, federal, courts
      - political environment: expanders, contractors,
    - - clear set of statements on intent of analysis; establishment of evaulative criteria- effectiveness, efficiency, administrative feasibility
      - outline informational needs: explain what data you need to answer; explain where you will obtain this information
      - methods to be used: explain how data will be presented, what type of comparisons will lbe made; how you will evaluate you results; how your results will be quantified; what type of conclusions will be made
      - Research objectives: questions
    - - according to research objectives
      - Analysis: summary conclusion emanating from research; alternative compared; critically evaluated
      - Evaluate costs and benefits: identify individual and social costs and benefits; quantify measurable costs; compare measurable costs and benefits
      - Externality and implementation problems: unintended side effects on a third party; offsetting behavior of individuals; issues in implementing policy
    - - regarding both proposed policy and alternative policy
- - - - Pareto Optimality:
        impossible to better someone's condition without simultaneously worsening another's via reallocation
        
        arises through volutnary actions without government intervention
        
        How is it created in free markets?
        
        competition among buyers
        
        freely competitive economy should provide optimal resource allocation
        
        government should be in business in income distribution
    - - assumptions of economic theory are violated in the real world
        
        full informaion
        
        no monopoly power
        
        Natural monopolies: fixed costs of prodiing a good are high relative to variable costs
        
        result of technology development and exclusive capital - Rx drgs and patent riights
        
        No externalities: effects on third party
        
        No public goods: non rivalry in consumption; non exclusive
        
        why does the free market not provide public goods
        
        free riders; people who don't pay benefit
        
        people enjoy benefits without paying; larger group larger issue
        
        consumers: not prepared to pay for something they can't exclusively own
        
        Public goods and congestion: marginal cost of an additional person using a public good that additional person reduces value of that public good for all users
        
        Public good is congestible when social benefit of consumption becomes negative after a while
        
        Tragedy of the commons: individual tries to reap the greatest benefit from a non-excludable resource; people consume more of product as demand greater than supply
- - - - measurement of benefits: (SOURCES OF DATA)flood control, cancer screening
      - Immeasurable benefits: impact of education; welfare programs
      - Measurement of costs: direct outlays are easy to determined- paid for with costs
      - Private osts: forced safety expenditures
      - Social costs: tax burden, less money for health
  - - - consumer price index: index of prices used to measure changes in cost of basic goods and services
      - US department of labor
      - What is discountinig?
        
        brringing futre money to value of today
        
        Takes care of two factors
        
        Influence of inflation
        
        earning power of invested money
        
        Dn = $ / (1+r)^n
        
        Estimate = inflation rate + bond yield
      - What happens if we need to estimate the value today of money due in the past?
        
        Future value formula
        
        FV = Dollars past due * (1 + r)^n
  - - - identify relevant impacts ;geography; choose relevant groups with preferences;
      - Monetizing relevant impacts
        
        valuing costs:
        
        measureable costs to private and social
        
        benefits of policy program
      - discounting for time and risk
        
        riskier future = higher discount rate
        
        capital depreciation: degeneration/deterioriation of capital investments in project
      - Choosing among alternative policies
  - - - why do we take risks?
        
        cost of a behavior change to avoid risk and perceived risk of negative outcome is underestimated
      - How do we measure life?
        
        Value of statistical life (VSL)
        
        ALTERNATIVE: Life years saved = difference between the average life span and a premature death
      - How do we measuure quuality of remaining life?
        
        Morbidity: using QALYs
        
        Years X Quality of liife (1 for excellenet 0 for none) = years