The Banality of CertaintyOrganizational, ethical and cognitive pathologies in the era of aid calculation

Pablo YanguasEffective States and Inclusive Development Research Centre

University of Manchester

[ Sheffield – 3 February 2017 ]

1The Politics of Certainty

Opportunism & policy change

• Financial crisis: Not a budgetary impact, but a political one

• Value-for-Money: “the optimal use of resources to achieve the intended outcomes” (NAO Toolkit)

• DFID 2010 BAR: “All new projects will be subject to a rigorous investment appraisal process prior to approval which will test the evidence underlying the intervention and its value for money more thoroughly” (2011 Technical Report)

• DFAT, Julie Bishop 2014: “Funding will be directed to projects that make a real and measurable difference”

VfM, risk and uncertainty

Risk vs Uncertainty(Objective probability vs Subjective probability)

F. Knight (1921)“The practical difference between the two categories, risk and uncertainty, is that in the former the distribution of the outcome in a group of instances is known (either through calculation a priori or from statistics of past experience), while in the case of uncertainty this is not true, the reason being in general that it is impossible to form a group of instances, because the situation dealt with is in a high degree unique.”

VfM assumes calculable riskDevelopment unfolds under uncertainty

2Organizational Pathologies

The demands of counter-bureaucracy

• 2011 DFID “Approach to Value for Money”• “3Es Framework”: economy, efficiency, effectiveness, and cost-

effectiveness• Aim: better results on the basis of stronger evidence and a more

open and competitive process of public procurement

• Counter-bureaucracy tools supplanted strategic tools• Business case, Operational plan, Anti-corruption strategies

Falsified development

• 2011-15 DFID Sierra Leone Operational Plan• Poor quality and limited data• Rapidly changing environment• Weak delivery capacity in GoSL• Changing costs of doing business• Weak fiduciary environment

“The incentives - rightly or wrongly - do not lead to honest explanations for why things are done” - “Few people would like to hear anything that rocked the boat“ - “The important thing is to make sure that there are measurable indicators in the results framework“ - “It's all about numbers, often very spurious numbers.”

Falsified development

“The demands of the counter-bureaucracy are now so intrusive that they have distorted, misdirected, and disfigured USAID‘s development practice to such a degree that it is compromising U.S. national security objectives and challenging established principles of good development practice.”

Andrew Natsios (2010), former USAID administrator

3Cognitive Pathologies

Aid, fast and slow

• Daniel Kahneman’s Thinking, Fast and Slow (2012)• System 1 thinking: quick, intuitive, effortless• System 2 thinking: slow, analytical, costly

• The counter-bureaucracy provokes two reactions:• Cognitive dissonance: reconciling uncertainty with calculability…• Cognitive overload: multiple demands, multiple layers, multiple

principals, complex consequences…

System 2 thinking becomes either inefficient (thus outsourced) or subversive, limiting

reflection and learning

Judgment under uncertainty

Tversky & Kahneman’s 3 heuristics:• Representativeness

• What do successful projects do?• VfM shortcut: demonstrate measurable impact (which is hard)

• Availability• Is there a recent example of success?• VfM shortcut: case narratives (which are scarce)

• Anchoring• What is the baseline for success?• VfM shortcut: service delivery (which is simplistic)

An overreliance on heuristics leads to a biased estimation of what aid can/should do

4Ethical Pathologies

Sketchy ethical calculation

VfM is an utilitarian theory of development assistance, leading to a moral teleology of aid whereby measurable impact = value.

But…

"In placing all conclusions at the beck and call of claims about the value of outcomes and about the vastly complex causal connections that determine outcomes, [utilitarian approaches] gain a spurious precision. Such reasoning may seem to anchor moral requirements in empirical calculation, but when evidence, data and calculations (not to mention units of account) are all hazy, those requirements will be elastic, if not indeterminate.“

(O’Neill, in Chatterjee 2004)

Ethics of uncertainty

• Absent data or calculability, we are left with principles and ideology – deontology replaces teleology• Value judgment becomes the essence of ethical choice:

Balancing the value implications of different courses of action given their intended, unintended and foreseen outcomes (Kamm)

But what moral compass does VfM provide?Can values be explored without system 2

thinking?

VfM in Jerusalem

“Except for an extraordinary diligence in looking out for his personal advancement, he had no motives at all. And this diligence in itself was in no way criminal; he certainly would never have murdered his superior in order to inherit his post. He merely, to put the matter colloquially, never realized what he was doing. …“That such remoteness from reality and such thoughtlessness can wreak more havoc than all the evil instincts taken together which, perhaps, are inherent in man - that was, in fact, the lesson one could learn in Jerusalem.”

Hannah Arendt, Eichmann in Jerusalem (1963)

5The Banality of Value-for-

Money

The banality of VfM

“The counterbureaucracy ignores a central principle of development theory—that those development programmes that are most precisely and easily measured are the least transformational, and those programmes that are the most transformational are the least measured”

Andrew Natsios (2010)

The banality of VfM

There is a risk that the political search for certainty may not lead to better developmental outcomes, but to aid interventions that are ultimately more superficial, mindless, and amoral.