Policy ParadoxStone (2002)

Chapter 12: Rules

John HanceAmy Hager

Haichang XinIfe Nelson

Outline Sources of Rules Function of Rules How a Rule Works Political Nature of Rules What Comprises a Good Rule Perverse Incentives Enforceability of Rules Informal vs. Formal Rules

RULES

Policy-making relies heavily on official rules

Laws = Rules

Sources of Rules

Examples of Society’s Many Rules Rules by Legislative bodies: Statutory

Law Rules by Administrative bodies:

Regulations Rules by Courts: Common Law Rules outlined by the United States

Constitution

Function of Rules Some rules

mandate behavior

Function of Rules Some rules confer

power (i.e. President of the United States is Commander in Chief)

How a Rule Works Rules are intended

to induce compliance

Rules derive their enormous power from legitimacy- in that they are perceived as good and right (why do people obey the speed limit in a school zone?)

How a Rule Works

Rules generally have 2 parts:

1) They prescribe certain actions to be taken

2) Within certain contexts or situations

How a Rule Works1) Prescribe actions to

be taken Formulated as

“if…….then” statementsi.e. IF you hunt

deer THEN you can only do it between the months of October and January.

IF you beat the best team to ever play college basketball, THEN you CANNOT rush the court or your school will be fined $25,000

How a Rule Works2) Within certain

contexts or situations Context (rules depend on

context) Kissing a child is a loving expression when performed by the child’s parents, but kissing a child is molestation when performed by a stranger.

The Gators will only rush a court or field after winning the NATIONAL TITLE

The Political Nature of Rules

Rules INCLUDE and EXCLUDE Rules UNITE and DIVIDE

i.e. Those treated favorably by a rule and those NOT treated favorably by a rule

Thus, rules create alliances

In Search of Good Rules

The tension between precision and flexibility

The essence of precision is that both actions and contexts can be described without ambiguity

Advantages of Precision (Precise Rules)

With precision the argument is that like cases will be treated alike (Consistency is Fair)

Precise rules are said to insulate people from the whims, prejudices, predilections and moods of officials

Precise rules provide predictability Symbolize the Rule of Law

Disadvantages of Precision (Precise Rules)

Rules cannot be perfectly tailored to individual circumstances

Precise rules stifle creative responses to new situations (we can never fully anticipate future circumstances- making it difficult to form rules or laws that account for new facts, technologies and context)

In Search of Good Rules

Must select some feature of a rule as a basis (a process of line-drawing)

Vague Rules are GOOD and BAD The vagueness of rules leads to a

large amount of discretion

Making Rules in the Polis

People try to shape rules to accomplish public and private purposes

There is a tension between precision and vagueness

Making Rules in the Polis When rules are made, they are usually

driven toward vagueness Rules arise from crises or problems

Social Security Act (Great Depression) Food and Drug Administration (Upton Sinclair’s

expose and thalidomide disaster) Civil Rights Legislation (marches,

demonstrations, and urban riots) US Constitution (Colonial Rebellion and the need

for order after loss of government) Declaration of Independence (“injuries and

usurpations” of the King)

The Origin of Rules Crises affect points of view

Create a mentality of absolute prevention (“that kind of tragedy” must never happen again)

Unites communities Makes people temporarily forget about

other conflicts Leads to a desire for wholesale solutions

(“fix the problem”) and politicians follow with vague, grandiose responses

Democracy and Legislators Formal rules are negotiated in elected

legislative bodies by representatives of affected interests

These bodies have characteristics that lead to vague legislation Legislator desire for reelection Must face conflicts with opposing constituency,

and within own constituency When there is a need for substantive rules,

ambiguity is often used

Rules and Tension

There is always some pressure on rules from evasion and disobedience Stems from the idea that rules are made

to prevent people from doing things they would otherwise do (or vice versa)

Interplay between those they govern and those who enforce them From this, perverse incentives arise

Perverse Incentives Incentives unwittingly built into a rule to

comply with it in a way that creates new problems or exacerbates the existing problem Textile factories given production targets in

terms of meters of cloth Medicare payments on basis of average

durations and Tx’s for categories of diseases Hospital’s respond by reporting some

patients as having more severe types of diseases, or discharge when patients are not ready to leave

Perverse Incentive in Practice

Rules and Different Dimensions Where there are multiple goals or we

care about several dimensions, rules governing only one dimension may distort behavior by forcing behavior in a separate dimension State that restricts drinking to age 21

might force younger people to go to more lenient states

Strong minimum wage laws might push businesses elsewhere to alleviate the stress of the imposed rule

Negative Aspects of Rules

Perverse Incentives will never be eliminated

Perverse Incentives are the result of poorly designed rules to some extent, but at the same time, people will always shirk and cut corners

Rules Are Evolving

Rules are continually changing depending on the relevant facts, values and norms

The Enforceability of Rules

Enforceability of Rules

The Enforceability of Rules

Official rules are backed by sanctions such as fines, revocation of privileges or imprisonment

Informal vs. Formal Rules

Formal Rules

A formal rule is concrete, specific and enforceable You may not purchase tobacco products

unless you are 18 years of age

Informal Rules

Informal rules are not explicitly enforced and they generally represent implied social norms (Hance et. al)

Informal rules are heuristics or rules of thumb Covering your mouth when you cough Chewing with your mouth closed

Rules

Questions?