Summary
In this article, Liebman examines the effectiveness of applying private-sector modeling and optimization techniques to "state and local decisions." Liebman colloquially refers to these problems as "wicked." Unlike private-sector issues, in which problems are often clearly defined and decisions unanimously agreed upon, public-sector issues are consistently marred by conflicting goals and individual biases. Liebman ultimately concludes that using private modeling techniques for public issues is like using an old tool for a new trick, and that the application of these modeling methods must be modified in order for them to be effective. He argues that only humans can resolve the complexity of "wicked" problems, and that models should be limited to assisting humans in the exploration of alternatives. Liebman then makes four "simple-minded suggestions," which are paraphrased below:
- "Modeling is thinking made public." Models inherently "develop and transfer understanding" from an analyst to a decision-maker. Decision-makers should be more involved in the model making process in order to increase their depth of understanding surrounding their subject of interest.
- "A model is not unique." Decision-makers often see the narrow view of one model's results. Seeing multiple, diverse models will lead to more informed decisions.
- "The model is the message." Analysts gain greater understanding from more complex models, but the public loses out. Models should be kept as simple as possible without sacrificing integrity.
- "Reinventing the wheel is not always bad." The use of a generic model gives the analyst no "feel" or understanding of its conclusions. Although time-consuming, a tailored model will usually be more accurate and provide more insight to an analyst.
Discussion
I personally found this paper more interesting than significant. Although he admittedly provides no answers in the article, the questions and concepts Liebman raises are interesting to ponder. Even with the factor of conflicting goals taken out of the picture, public issues are still staggeringly complex - modeling a balance sheet at a small company is obviously an easier task than optimizing traffic flow in a city like Houston or Los Angeles. Nevertheless, Liebman does an excellent job of proving public "wickedness" to be the crux of issues. When comparing the urban firefighting and river basin quality cases, Liebman shows that is it the nature of issues, not their technical complexity, that determines the success or failure of traditional modeling techniques.
I found Liebman's four "suggestions" to be an extension of common sense, which is probably why he called them "simple-minded." To me, Liebman's four suggestions can be boiled down even further:
I found Liebman's four "suggestions" to be an extension of common sense, which is probably why he called them "simple-minded." To me, Liebman's four suggestions can be boiled down even further:
- If you're involved with making your model, you will understand more.
- Seeing more points of view leads to a better decision.
- Keep it simple, stupid.
- Specialized models will be more accurate and understandable than generic ones.
Despite the shortcomings of his suggestions, I found Liebman's idea of using modeling for suggestions to be insightful. A possible implementation of this concept would involve two systems, one with a traditional-decision model and the other using Liebman's model-suggestion technique, and comparing the performance of the two. Unfortunately public systems are not "amenable to experimentation," which would make such comparison difficult. Other future work based on Liebman's idea could involve improving models and their suggested alternatives based on the traditional behavior of competing parties and other social inputs. If this were my research, I would work to improve the four "suggestions" Liebman provided and begin developing a controlled experiment (similar to the aforementioned one) to analyze their effectiveness. As they stand, Liebman's concepts and suggestions are very broad, and could be applied to almost any public scenario. I feel specificity, such as a modeling approach for river basin quality management, would lead to more rapid and measureable progress in the application of his ideas.
Ulibarri, Carlos, Harry Seely, and David Willis (1998) "Farm Profitability and BUREC Water Subsidies: An LP Look at a Region" Contemporary Economic Policy Vol. XVI pp. 442-451Summary
At the heart of this article is the United States Bureau of Reclamation (BUREC) "irrigation assistance" policy. The policy has a long political history, but boils down to the fact that "irrigators are accountable to the Treasury for repaying BUREC construction costs." Construction costs stem from federal irrigation projects such as the Central Valley Project, which supplies 2 trillion gallons of water per year and serves as the lifeblood of agriculture in central California. The government is then paid back over a period of time based on the amount of water that irrigators use. If irrigators are unable to repay the government for irrigated water which they have used, the deficit is subsidized by an increase in the cost of electrical power which is provided by the federal government. In effect, the burden of cost is passed to anyone using federal power, even if they are not involved in agriculture. Due to a quirk in federal legislation, the US Treasury is also a source of water subsidy - although irrigators are required to repay the Treasury for the cost of construction, interest on irrigation-related capital costs is ignored, thus leaving the Treasury out to dry on multi-million dollar repayment plans that span the course of decades. The paper aims to formalize "...the cost relationship between power rates and irrigation water" by constructing a linear programming model which "estimates the change in farm profitability" from elimination of these costly subsidies. The results of the model indicate such action would result in a $4.58 million annual redistribution of irrigator profit to federal power users and the US Treasury.
Discussion
This article is significant in its findings. Although the final results show a $4.58 million annual redistribution of profit, the authors also note that such losses would not represent "significant regional impacts on growers," especially if taken in stride with more efficient irrigation and other water-saving techniques. With a US Treasury irrigation debt of $137 million in 1996, the authors feel that the results of the model illuminate a necessary course of action.
I feel that the authors did a poor job of explaining their model in the paper, which is probably why my explanation here is not very deep, either. There are some generalized mathematical formulas contained in Part III of the work, but they give the reader little insight. A clearer explanation of the model would give the final findings more validity.
Since the availability of water is very dynamic over time, future work in this area might relate to the restructuring of irrigation subsidy policy. Greater scarcity of the resource over time will translate to costlier projects which irrigators will have less of a chance of paying back. In the end, policy must be flexible over time as conditions change in order to create the most equitable situation for everyone involved.
Discussion
This article is significant in its findings. Although the final results show a $4.58 million annual redistribution of profit, the authors also note that such losses would not represent "significant regional impacts on growers," especially if taken in stride with more efficient irrigation and other water-saving techniques. With a US Treasury irrigation debt of $137 million in 1996, the authors feel that the results of the model illuminate a necessary course of action.
I feel that the authors did a poor job of explaining their model in the paper, which is probably why my explanation here is not very deep, either. There are some generalized mathematical formulas contained in Part III of the work, but they give the reader little insight. A clearer explanation of the model would give the final findings more validity.
Since the availability of water is very dynamic over time, future work in this area might relate to the restructuring of irrigation subsidy policy. Greater scarcity of the resource over time will translate to costlier projects which irrigators will have less of a chance of paying back. In the end, policy must be flexible over time as conditions change in order to create the most equitable situation for everyone involved.