This week, my frequent collaborator Peter John will be presenting the first paper in a larger project on the prioritization of public policies by governments at the European Political Science Association meeting in Dublin. We argue that governments seek to enhance their chances of re-election by managing their risks from attending to particular policy problems. In this way, government is like an investor making choices about risk to yield returns on its investments of political capital. We claim that the public provides signals about expected political capital returns for government policies, or policy assets, that can be captured through expressed opinion in polls. While always approximate, these price signals are at times noisier than others meaning that uncertainty in the environment in which governments must choose policies correspondingly differs. The amount of attention that a government gives to a policy domain, or what we call its investment level in a policy asset, generates return to political capital but also risk due to the variance of each asset and the covariance among them. The nub of our theory is that strategies of statecraft consider risk and return in their policy portfolios and uncertainty in the public’s policy valuation. We think this is a novel way for examining policymaking and leadership in government.
 There is, of course, no political market where voters go continuously to the polls with high turnout and assess individual policies. This is arguably the central difference between the study of politics and of economics. However, we claim that citizens can express opinion that we measure through frequent polls. Governments endeavor to learn such information and take it as a price signal for its policy assets. With that information, sometimes noisier than others, government makes investment choices.
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