Skating on thin evidence: Implications for public policy

Good public policy needs to be evidence based. However, the evidence base is thin for many policy issues. How can policy makers best respond to such thin areas of research that are also quite likely to change over time? Our survey investigates the evolution of the econometric evidence base for 101 e...

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Bibliographic Details
Published in:European Journal of Political Economy 2018-09, Vol.54, p.16-25
Main Authors: Doucouliagos, Hristos, Paldam, Martin, Stanley, T.D.
Format: Article
Language:English
Subjects:
Bias
Econometrics
Economic models
Economic policy
Elasticity
Errors
Exaggeration
Meta-regression
Paldam rule of thumb
Policy analysis
Policy making
Political economy
Predictions
Public policy
Thin evidence
WAAP
WLS
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Summary:Good public policy needs to be evidence based. However, the evidence base is thin for many policy issues. How can policy makers best respond to such thin areas of research that are also quite likely to change over time? Our survey investigates the evolution of the econometric evidence base for 101 economic issues, drawing upon 42,578 effect sizes (mainly elasticities and correlations) from 4300 econometric studies. We evaluate the performance of six approaches to early research assessment: the simple unweighted mean; the median; the Paldam, “divide by 2” rule of thumb; the unrestricted weighted least squares (WLS) weighted average; the PET-PEESE meta-regression correction for publication bias; the weighted average of the adequately powered (WAAP); and WAAP-WLS. Lowest prediction errors are found in the Paldam rule of thumb and WLS. WLS typically reduces the initial exaggeration of thin evidence by half.
ISSN:0176-2680
1873-5703
DOI:10.1016/j.ejpoleco.2018.03.004