Including ethics in economic policy decisions
How can you include citizens’ ethical considerations in real-world economic policy analysis? In the MVI-project Participatory Value Evaluation: a new assessment model for promoting social acceptance of sustainable energy policies, researchers from Delft University of Technology and VU Amsterdam further develop a new assessment tool that does exactly that. The research combines insights from Economics, Philosophy, Political Science, Environment and Natural Resources.
In the Participatory Value Evaluation (PVE) method, citizens choose a portfolio of policies given one or more constraints, such as limited budgets or sustainability targets. Using these individual choices behavioural choice models are estimated that subsequently form the basis for an evaluation of different policies.
This choice based assessment paradigm is inspired by the cost-benefit analysis approach (CBA) project leader Niek Mouter from Delft University of Technology worked on before, he says. ‘With CBA, we are able to map the effects of proposed governmental policies upfront, to enable informed decision-making. The method focusses on individuals’ monetary willingness to pay: we ask citizens what amount of money they would be willing to pay from their private income to achieve certain goals. However, a key deficiency of CBA is that ethical considerations, which cannot be easily translated into monetary terms, are excluded in the assessment.
Policy that matches preferences
The PVE set-up aspires to rectify this issue by approaching policy options from a different angle: citizens are asked to choose the policy options that best match their preferences given one or more constraints. Hence, monetary valuation is not required. ‘With our method, we place the citizens in the shoes of the policy makers, and ask them to balance delicate trade-offs between ethical, social and economic effects of different policy options,’ Mouter explains. In case they do not want to make this trade-off they can delegate their decision to an expert, a politician or a fellow citizen.
Not only an assessment tool
PVE not only enables the desired ethically sensitive policy evaluation, but also facilitates far-reaching participation of citizens in the design of collective policies, concludes Mouter from the first two pilot studies he conducted with this method. ‘For one of these studies we did for the Ministry of Infrastructure and Water Management, we asked 3000 people to allocate 700 million euros on flood protection policies. As a side effect, we found that participants valued the fact that the government involved them in these decisions. Also, these people reported to have gained more understanding of some of the dilemma’s the ministry has to face when making such a decision.’
The fact that with this method, people only have to invest about half an hour of their time to submit their choice lowers the threshold to participate, Mouter thinks. ‘Usually when for example a municipality wants to organise public participation, they hold meetings that are mostly attended by older, higher educated men, and activists.’
In this new MVI project the PVE-method will be applied to involve citizens in choosing which measures should be taken to achieve sustainability targets set by the cities of Amsterdam and Helmond. This will open up a myriad of scientific questions, Mouter says. ‘One of the main questions is how we can make ethical dilemma’s explicit in an easy to grasp way. Furthermore, we will have to develop smart ways to obtain useful insights from the choices people make. Since they only have to pick one of the presented options, we need to come up with ways to identify the different motives that might have driven them to their final choice. And finally, how do you translate the outcome of such an evaluation into a solid policy advise? Who determines the best option in the end, and based on what?’
Live up to the promise
Though the PVE tool has been used before, it is still in the exploratory phase, Mouter emphasizes. ‘We think it is a very promising method to enrich or replace cost-benefit analyses for governmental policies, and to stimulate participation of citizens in decision-making processes. With this project, we hope to be able to further develop it in such a way that it can live up to that promise.’
The test-version of the PVE-experiment conducted with the Ministry of Infrastructure and Water Management can be found here (in Dutch): http://ienw.participatie-begroting.nl/