Evidence-based policy

A recent Nature editorial (Over the limit: Evidence should be considered when setting policy, but not to the exclusion of other factors) argues against evidence-based policy:

The evidence is clear. Statistics from the United States, Europe, Asia and Africa all point in the same direction: male drivers are more likely to crash their cars than females. Aggressive behaviour, rule-breaking tendencies and a greater willingness to take risks are all thought to contribute. Taken together, male drivers are a riskier bet, and face higher premiums for car insurance as a result.

Last week, the Court of Justice of the European Communities took a wrecking ball to this seemingly evidence-based policy. From December next year, insurance companies will no longer be able to discriminate on the basis of sex: men should see their premiums fall and women will pay more. [...]

The court's decision affects more than car insurance — life assurance premiums paid by men could rise to match those paid by women, where previously they were discounted because men on average die earlier.

And Nature agrees with the court because Nature thinks that policy should not be based only on evidence but "must also take into account social, economic and political factors."

I disagree. We would be better-off if policy were based exclusively on evidence, including social, economic, political and ethical evidence. Evidence tells us that if we impose homogeneous insurance pricing then we will get less insurance and it will be more expensive, contrary to the wishes of potential insurance buyers and society as a whole. Some men may cheer at this particular ruling, but both men and women stand to lose in the long run as the same "anti-discriminatory" criterion "to ensure equality between men and women in access to and provision of goods and services" gets applied in instances other than car and life insurance. And this need not stop at insurance. If men and women are to pay the same prices for the clothes they wear, the books they read or the courses they attend, we will all end up paying higher prices for and getting fewer quantities of clothes, books and education.

I think that Nature's attitude towards "evidence" is due to its ideological stance against the science of economics. For Nature, statistical data on car accidents count as "evidence", while the vast amount of information on how people respond to prices does not.

A sensible approach to economic growth policy

Collectivists are divided about economic growth. On one side, conventional socialists and conservatives believe that government should promote it. On the other, Ecological Economists and other greens want government to stop it. The idea that government can effectively facilitate economic growth applies mostly to fantasyland, while the opposite one of government hampering economic growth is put into practice everyday in every country with spectacular results.

Regarding the desirability or not of economic growth policies, an article in the latest issue of Ecological Economics (Environment versus growth — A criticism of “degrowth” and a plea for “a-growth”, by Jeroen C.J.M. van den Bergh) came as a pleasant surprise:

If one accepts that GDP (growth) is not a robust, reliable indicator of social welfare (progress) then the only solution is to ignore it and as a result be completely indifferent about GDP growth. GDP growth is good in some periods or for some countries, but unconditional growth is not a wise aim. GDP growth is not generally necessary or sufficient for progress. Neither is GDP degrowth necessary or sufficient for sustainability. Correlations between GDP and welfare or between GDP and environmental impact are not constant and fixed over time. One can therefore not exclude the possibility of “dirty GDP degrowth” or a degrowth which hardly reduces environmental impact.

Instead of a policy of shrinking the economy van der Bergh advocates changing the composition of production and consumption by taxing activities with negative environmental externalities. He also wants government to allow "a flexible labor market that allows for part-time work contracts", to limit advertising of luxury goods and to sponsor technological research. I doubt the usefulness of the latter two proposals, but overall van der Bergh's position is very sensible.

In defence of degrowth is Giorgos Kallis's response to van der Bergh. It hurts to read it.

The world vs. corporate profit

Some people want to mine the Bismarck Sea's sediments for copper, zinc, gold and silver. In a letter to Nature, George M. Woodwell cautions that mining will both affect the interesting organisms inhabiting hydrothermal vents and release minerals that are toxic to other marine life.

By what right do we destroy [hydrothermal vents] for corporate profit? [...]

The world is too small for this further destructive intrusion — it should be stopped now before it becomes another corporate atrocity, too big and too valuable to stop.

First, if we suspect this "intrusion" is to become too valuable to stop then we should probably go ahead with it. Second, "we" do not mine for corporate profit. "We" do it for the copper, zinc, gold and silver.