The Logic of Public Policy Design:

Linking Policy Actors and

Plausible Instruments

Stephen H. Linder and B. Guy Peters

This article examines the implication that insufficient attention is paid to

design in policy analysis, as well as the logic of treating the design process
analytically. The authors introduce a set of analytic instruments intended
to structure the design process. For illustration, they reconstruct and reex-
amine the design process in cases where several well-defined and seem-
ingly antithetical solution strategies exist.

Over the past two decades, public policy studies have shown transfor-
mation from their roots in social sciences. This change has been prompted,
in part, by the idea that policy inquiry must attend not only to casual
relationships, but also to public problems and their possible remedies.
Curricula in professional public policy schools typically offer a large dose
of positivist e p i s t o m o l o g y - - d r a w n from social science--but are best
characterized by preoccupation with rigorous problem-solving. A policy
analyst's claim to expertise is a combination of instrumental rationality
and sensitivity to process and context that constitutes a technology for
solving public problems. Much of the research in policy studies is refine-
ment and extension of that technology. One drawback to the policy stud-
ies' laboring at the periphery of the social sciences, however, has been

Dr. Steven Linder is associate professor in management and policy sciences at

the University of Texas School of Public Health. His principal interest lies in
policy analysis, currently focusing on policy design and implementation issues.
His most recent work has appeared in Policy Studies Review, Milbank Quarterly,
and Journal of Policy Analysis and Management.

B. Guy Peters, Ph.D. is the Maurice Falk Professor of American Politics in the
Department of Political Science at the University of Pittsburgh. He currently is
working on several research interests in comparative public administration and
policy design.
Knowledge and Policy: The InternationalJournal of Knowledge Transfer, Spring-Summer 1991, Vol. 4, Nos.
1 and 2, pp. 125-151.
126 Knowledgeand Policy / Spring-Summer1991

the need to forego theoretical guidance for practitioners. Consequently,

progress remains uneven. Gaps in knowledge persist and go unrecog-
nized for long periods. This article calls attention to one such gap and
proposes a way to close it by extending the technology of critical policy
analysis and supplementing its theoretical backing.
The instrumental side of the technology defining policy analysis---de-
rived from economics and management science--overwhelmingly favors
the task of choosing among alternatives over the task of inventing alter-
natives. While options and problem definitions can both be structured
analytically, the search for possible "solutions" is often ad hoc and lim-
ited to analogy and advocacy as its principal devices. Further, the con-
nection between the analytical and ad hoc aspects of the exercise remain
ambiguous in theory and muddled in practice.
The side of the technology sensitive to process and context offers a
more reliable route to generating proposals but does no better at ensur-
ing variety or fostering invention. The empirical evidence on the fashion-
ing of solutions and their linkage to problems, at least for the policy-
making process in the United States, appears to fit a "garbage can" meta-
phor (Kingdon, 1984; Levine, 1985). Solutions, problems, and opportuni-
ties exist independently and are combined largely by coincidence. Having
solutions that antedate problems, however, has implications for applying
policy analysis. In a "garbage can" situation, analysis shifts from the
merits of solutions---those having been touted by their advocates--to
questions of problem definition. The weight of analytical argument falls
on structuring problems in ways relevant to the a priori "solutions."
From this perspective, contending problem definitions are drawn by dif-
ferent policy communities to favor their own solutions. Acceptance of
one problem definition then is tantamount to a victory for its correspond-
ing solution.
Theorizing about solutions in this context naturally proceeds from the
particular solution to its applicability over a general class of problems,
rather than the reverse. This depiction also reinforces a basic weakness in
the technology by diverting analytic attention away from the search for,
and development of, solutions. The solution, or set of solutions, is a
given with application being the goal of the process. In contrast to public
policy studies, the planning profession has devoted considerable atten-
tion to the analytical development of solution strategies (see Alterman
and MacRae, 1983). Planning not only has a tradition of design and inno-
vation but appears more amenable to the application of context-free logic
in its analysis of public problems (Friedman, 1987). The idea that solution
strategies should be fashioned systematically and deliberately before policy
options are framed is a central component of systematic planning. There
are a number of design methods in planning that might be applicable to
policy problems but their diffusion has been quite limited (Alexander,
1986).
This is not to say that design remains alien to policy studies. The claim
Linder and Peters 127

that attention to designing solution strategies may improve policy per-

formance has been embraced by a number of policy researchers (Dryzek,
1983; Miller, 1984; Linder and Peters, 1984; 1987; Hoppe et al., 1987;
Ingram and Schneider, 1987). Moreover, in most textbooks on policy
analysis (e.g. Dunn, 1981) one can find reference to the "search" for alter-
natives, along with advice about its costs and limited utility. Neverthe-
less, there is not the careful attention to design as a separate analytical
task that there is to problem definition or appraisal of existing options.
One consequence of this is that the design of solution strategies is left
open to analysts' idiosyncratic biases that may restrict the range of pro-
posed alternatives.
The next section of the article examines implications of insufficient
attention to design in policy analysis and the logic of treating the design
process analytically. Following this, we address the problem of develop-
ing a design logic for structuring designing in such a way that premature
closure through presumptive biases is minimized. To develop such a
logic, for explanatory and prescriptive purposes, we introduce a set of
analytical devices intended to structure the design process. To illustrate
the logic, we reconstruct the design process for protective regulation and
reexamine design problems in cases when several well-defined and
seemingly antithetical solution strategies contend. In this case, the debate
over solution strategies assumes the form of rivalry among policy instru-
ments. The design problem then is how to define the full set of contending
instruments in a way that encompasses not only the usual choices but
innovations and recombinations as well.

The Biases of Unconscious Design

Any application of unconscious designing to policy will almost inevi-

tably include bias. By its nature, such a process is unaware of that bias
and tends to perpetuate potentially dangerous presuppositions and er-
rors. The following are among the principal sources of such bias.

Modeling Causes
Policy interventions assume underlying causal mechanisms. Analysts
may differ, however, over the need for specification of those mechanisms
and their associated hypotheses. An analyst's position concerning the
proper form of causal knowledge for policy-making will influence the
approach to the design of alternatives. Those relying on computer simu-
lations of policy problems represent one type of formalism and view
design exclusively as model specifications (Brewer, 1973; House, 1982).
Once variables are chosen and their structural relations are specified,
fashioning alternatives is relatively trivial. So long as the model is prop-
erly designed, the quality of alternatives is, for the most part, assured in
this formulation.
128 Knowledge and Policy/ Spring-Summer1991

Ironically, formal methods with elaborate procedures for generating

normative solutions (e.g., optimization techniques) often rely upon rudi-
mentary approaches to model specification (Learner, 1980). The identifi-
cation of manipulable variables and their functional relationships is sub-
ject to informal rules of thumb and ad hoc practices. Mathematical pro-
gramming, despite rigor in generating solutions, must rely upon informed
observers to volunteer quantifiable goals and other ingredients of the
problem before modeling can proceed (Lewin and Shakun, 1976). The
design task then becomes one of constructing tractable functions of those
variables, defining a range of policy alternatives differing in degree from
one basic alternative.

Valuative Assumptions

A principle of evaluation also must underlie the fashioning of every

policy instrument. Values are applied to putative solutions in a number
of ways. First, values serve as criteria for distinguishing more from less
desirable interventions, based on factors ranging from economic efficiency
to distributive impact. Values can signal problems and gauge their sever-
ity. Typically, the use of values as criteria follows the canons of substan-
tive rationality; the achievement of a single value is maximized subject to
fixed constraints on acceptability. To the extent that an idea of "best"
remains elusive, the focus on values shifts from criteria to grounds for
justifying them. In other words, the problem becomes one of procedural
rather than substantive rationality (Simon, 1978).
The distinction between these approaches to the utilization of values
has several implications for design. If we focus on substantive criteria,
such as efficiency or equity, designs will be appraised in terms of their
consequences, typically expressed as performance on measures of prob-
able outcome. Since there is no definitive way of collapsing criteria to
form a composite measure, most values serve as fixed constraints for
eliminating nonconforming designs rather than as competing performance
criteria. The public may apply the same logic in their informal analyses
of policy, disavowing perceived inequitable policies (the poll tax in Britain)
on that criterion alone. Moreover, focusing appraisal primarily on the
performance of difficult solution strategies assumes that we can neutralize
influence by process considerations. The dilemma behind the use of purely
substantive criteria remains "can we make proper choices among criteria
once technical performance norms replace procedural ones and, at the
same time, insure that solutions will be incorruptible?" As Majone (1989)
points out, for those emphasizing procedural rationality, the answer is
clearly no. For him, outcomes are affected more by procedural arrange-
ments of institutions than by attributes of particular instruments. This is
consistent with a growing interest in the "new institutionalism" in the
social sciences as a means of more fully integrating the effects of organi-
zational and other contextual factors with policy analysis.
Linder and Peters 129

Procedural rationality suggests that decision processes can have built-

in appraisal mechanisms which automatically eliminate undesirable fea-
tures of solutions, and do so more effectively than substantive criteria.
Crafting solutions, then, involves invoking an appropriate institutional
process, such as that outlined by the Administrative Procedures Act in
the United States. For doctrinaire proceduralists, design is intractable,
and useless, since instruments and criteria--means and ends--are not
separated in practice. While the design task must be faced sometime,
proceduralists see it as best encountered in the midst of bargaining and
accommodation over a solution, rather than as an antecedent choice of
particular policy instruments. Yet, confidence in the capacity of process
to fashion solutions betrays satisfaction with results of an earlier round
of design activity that may or may not have met process norms.

Instrument Bias

There is a strong strategic element in problem definition that militates

against fashioning new solutions. The investment required to gain famil-
iarity with any solution represents a sunk cost for individuals and orga-
nizations. Treating problems with familiar instruments economizes on
resources, at least in the short run, and seemingly reduces risks of unan-
ticipated outcomes. Moreover, some solutions have demonstrative--and
therefore politicalmvalue regardless of their applicability or performance;
examples include mandatory sentencing for certain offenses, tariffs and
large-scale public works.
An unprejudiced crafting of solutions in response to problems is the
exception rather than the rule. The clash among biases has not only af-
fected changes in research orientations, but shaped debate over
government's role in controlling social risk (Kelman, 1981). On this and
other policy questions, complex dimensions of problem and solution are
reduced to dichotomous choices between market and non-market instru-
ments.

Actor Bias and Instrument Match

More subtle is a bias that confounds instruments and actors--the traits

and performance of one influence judgments about the other. In the sim-
plest case, confounding takes the form of guilt by association. Instru-
ments generally associated with a particular actor may be rejected for
reasons having more to do with traits of the actor than with inherent
flaws in the instrument. Many criticism of regulation by direct controls,
for example, speak more to shortcomings of centralized regulatory bu-
reaucracies than to intrinsic problems of controls (White, 1981). Regard-
less of whether associations are positive or negative, they represent habits
of unconscious design that are difficult to overcome. Thus, the same few
actor-instrument matches appear repeatedly (Breyer, 1982).
130 Knowledge and Policy / Spring-Summer1991

One objective of a conscious design orientation to policy-making is to

expand the set of plausible matches between instrument and institution,
and more importantly between policy problems and instruments. How-
ever, expanding the set is insufficient. There must be some means of
making the impact of selection biases explicit so that they may be recog-
nized, if not overcome. The next section introduces an analytic device to
deal with both expanding the set of acceptable matches and explicating
biases in unconscious design.

A Framework for Conscious Design

The motive behind the proposed framework is to structure design as a

systematic activity composed of a series of choices. To clarify that ap-
proach, each choice will be simplified and represented by an illustrative,
spatial heuristic. Design solutions, then, will correspond to a set of pos-
sible locations in a design space. This construction emphasizes not only
the potential for generating new mixtures of conventional solutions, but
also the importance of giving careful attention to tradeoffs among design
criteria when considering instrument choices.
There are several alternative heuristics that might be applied to the
design task each emphasizing what amounts to a different phase of the
design process. Perhaps the most popular one, having roots in both sys-
tems engineering and town planning, is the design matrix. In this in-
stance, the emphasis is on judging the relative performance of a given
selection of public investment plans, rather than on aiding design formu-
lation per se, with competing criteria arrayed along one dimension and
the candidate plans along the other (e.g., Lichfield et al., 1975). At the
opposite end of the design process, before any alternatives have been
formed, there are a range of nominal group techniques for identifying
value assumptions and criteria (e.g., Mitroff et al., 1982). Our heuristic
falls between these two classes and deals primarily with the designing of
alternatives; it shares this focus with several less formal, step-by-step
procedures intended to structure design principally around feasibility
concerns (May, 1981; Elmore, 1985). Our heuristic differs not only in its
form, employing a spatial analogy in place of checklists, but formally
connects the problem of institutional design with that of instrument choice.
Our analysis begins by breaking down the task of policy design into
two separate problems, each tied to our two basic design features---ac-
tors and instruments. The first problem is to establish one ordering among
familiar actors and another among instruments based upon carefully se-
lected procedural criteria. Selection of these criteria reveals the attributes
of actors and instruments that the analyst considers most important in
light of a problem's perceived requirements. In effect, these attributes
become manipulable variables, the levels of which the analyst can control
by introducing more design features. The ordering of these features is
likely to reveal any selection biases, raising the possibility of implicit
Linderand Peters 131

criteria that should be added explicitly to the assessment. The second

problem is to assess various combinations of actors and instruments to
create plausible actor-instrument ensembles, which can then be assessed
through substantive criteria. Here, the emphasis shifts from concern with
the constituent features of design--actors or instruments--to performance
characteristics of design ensembles as potential policy solutions.
While the principal function of the heuristic presented here is to con-
vert allegedly unconscious assumptions about policy alternatives into
explicit design choices, its conceptual implications are somewhat broader.
A research focus on policy design has typically meant either the study of
institutional designs (e.g., Kaufmann et al., 1986; Gormley, 1987) or the
analysis of policy instruments (e.g., Linder and Peters, 1989)--but not
both. Part of our purpose is to link these two together to form a distinct
analytical unit that can capture more directly the potential variety of
their interrelationships. This is not to say that the institution-instrument
combination as a concept matters more in some respects than either taken
alone, but rather that it represents a relatively unexplored unit of analy-
sis with potential utility as both a research and design tool, and thus
deserves greater attention.

Selecting Design Features

While there is a need to embrace some fairly weighty assumptions
about commensurability among actors and instruments in order for the
heuristic that we propose to be plausible, we can reduce the burden
somewhat by conducting our analysis within a restricted policy domain.
Our assumptions about relevant actors and instruments then need only
apply within domains and not across them. Out of the profusion of
typologies for differentiating policy domains, we have selected Hood's
fourfold scheme of Nodality, Authority, Treasure, and Organization
(Hood, 1984), as an admirable display of functional generality with an
instrument focus. Within each domain, one can expect to find a distinctive
set of relevant actors and instruments performing roughly similar func-
tions. To illustrate our spatial heuristic we have chosen the Authority
domain and have decided to concentrate on the design of social regulation
in the United States. The area of social regulation, given its ties to ideo-
logical conflict, has arguably received more attention by advocates of
competing designs than any other. Further, it is one of the few areas
where explicit comparisons of policy instruments have been made. Con-
sequently, we can expect relatively greater familiarity with this class of
instruments and can concentrate instead on the details of the design
process.
For social regulation in the United States conscious design means mov-
ing away from definitions alluding to social harms and from pat command
and control solutions that these invoke. Basically, the design problem is
how best to change behaviors, regardless of whether we are motivated
132 Knowledge and Policy/ Spring-Summer1991

by social cost, the public interest, or concern for vulnerable populations.

Changing behavior whether by individuals or organizations requires two
kinds of mechanisms, one setting the necessary controls and another
ensuring compliance. The first task is to specify the plausible design
features of each. For setting controls, the actor and instrument become
rulemaker and rule; for ensuring compliance they are enforcer and in-
ducement.
The second task is then to appraise systematically both individual de-
sign features and their combinations as mechanisms for producing be-
havioral change. We must be certain that an appropriate rulemaker and
enforcer are chosen for each set of rules we hope to implement. Following
the progression noted earlier attention will now shift to the analytical
details of the design task, beginning with the articulation and selection of
individual design features.
Actor 1: The Rulemaker. We can begin by considering the question:
"What institutional form should govern levels of control over behavior?"
We can discriminate among different possible rulemakers on several pro-
cedural grounds. First, rulemakers are more or less centralized. Second,
rulemakers tend to exhibit varying degree of flexibility. Some respond
flexibly to diversity among the objects of regulation, while others may be
rigid and unresponsive. Third, rulemakers differ in how they make rules,
and in their accountability for their actions. These three characteristics--
centralization, flexibility, and accountability--are familiar organizational
variables and, as such, can be easily transformed into criteria and applied
to our rulemakers.
Some rulemakers follow the judicial pattern of case-specific decisions,
while others follow the administrative pattern of seeking standardized
and uniform decisions, In either case, procedures may be formal or infor-
mal, depending upon the role of due process considerations. Clearly, the
pattern adopted by rulemakers in fashioning rules is closely related to
their preferred means of applying rules. Although a rulemaker's agent
may implement uniform rules flexibly, or rigidly implement case rules,
we assume that most rulemakers would not knowingly tolerate such
divergence from their desired pattern.
Flexibility is an attribute characterizing both the making and applica-
tion of rules. It has, however, several connotations. The first is adaptabil-
ity; that is, "can the rulemaker cope with the unexpected and the un-
known?" (Quade, 1982). Flexibility, then, serves as a hedge against uncer-
tainty and represents an ability to respond to changing circumstances.
Closely related is the connotation of reasonableness, a product of the
common link between rigidity and unreasonableness (Barbach and Kagan,
1982). The flexible rulemaker can take account of special circumstances
and respond appropriately. Nonetheless, the connotations are not all
positive. Flexibility can also imply expediency or arbitrariness, and be
viewed as a source of inequitable or capricious treatment.
Centralization is also an important attribute of actors, reflecting their
Linderand Peters 133

choice and handling of rules. More specifically, centralization refers to

the concentration of authority and control. The more centralized the ac-
tor, the tighter this concentration becomes. With authority confined to a
small cadre, the actor must rely on standardized procedures for control.
In turn, the choice and application of rules tends to become formalized
and inflexible, and response to changing conditions becomes slow and
unwieldy. Thus, centralization and flexibility tend to vary inversely. For
purposes of establishing an overall ordering of actors, the particular rate
at which this tradeoff occurs need not be specified; centralization will
simply be treated together with flexibility as a composite dimension. This
ignores the few cases where centralization may increase flexibility (e.g.,
removing decisions from a rigid field staff).
Accountability is the second procedural attribute serving as a design
criterion for appraising actors. Like flexibility, it has several connotations
(Greer, Hedlund and Gibson, 1978). Accountability may suggest culpa-
b i l i t y - t h e capacity to be held responsible for misdeeds. It might connote
accessibility and responsiveness. Finally, it may suggest an absence of
autonomy or restraint by a narrow latitude of discretion. The common
element in all this is a sense of social trust, whether ensured by legal,
moral, or electoral means. Unfortunately, the institutional response to
this norm often takes the form of increased centralization and standard-
ization of rules. Accordingly, more centralized, inflexible rulemakers tend
to be considered more accountable.
A third appraisal criterion addressing procedural protection speaks to
the rulemaker's capacity for representing the interests of affected parties
in its deliberations over rules. To what extent, for example, do "due
process" considerations structure the rulemaker's discretion? Are there
procedural protections afforded the rights of regulated parties? These
concerns relate more generally to procedural fairness of the rulemaker
and to the legitimacy of its rules. Uses of power without countervailing
protections are generally viewed as arbitrary and subject to organized
challenges. While procedural protections may reflect the procedural fair-
ness of the rulemaker, substantive fairness or equity raises a separate set
of issues to be discussed later.
Clearly, these criteria do not capture all procedural concerns about
government rulemaking, nor are they intended to represent the defini-
tive core of possible criteria. They are simply a sampling of well-known
appraisal criteria, chosen as proxies for a wide range of concerns. As
appraisal criteria, they can be used to order actors through explicit as-
sessments in the place of implicit biases. From a somewhat different
perspective, these criteria represent policy variables to be manipulated.
By refining an existing form or fashioning a new one, we may be able to
increase the flexibility or decrease centralization. In instances where the
levels of such criteria can be present in the form of standards or mini-
mally acceptable thresholds then design can proceed more readily.
In Figure 1 the appraisal criteria appear as axes defining a three-di-
I34 Knowledgeand Policy/ Spring-Summer1991

Figure 1
An Appraisalof PotentialRulemakers
FLEXIBILITY

I"/~ individuals
f private groups

f professional
associations

l control judicial
,. sp~ilists O f system
9r PROCEDURALPROTECTION

/. "."!t"a.:!71!!l !!v'.:)!'.'~" 9~'3 ~ ?deral g~

ACCOUNTABILITY

mension space. A number of actors have been assigned subjectively to

locations, consistent with their relative orderings on each criterion. The
federal regulatory agencies appear in the lower right-hand portion of the
space: close by are state and local agencies. The judicial system, includ-
ing federal district and state courts, also appear in this region. While
offering the highest degree of procedural protection and relatively greater
flexibility with their case-by-case approach, the courts remain less ac-
countable to the general public than many regulatory agencies. The courts
are not required to offer a period for "notice and comment" by the public
prior to making decisions, and do not have their decision-making as
closely monitored by other political institutions.
In addition to agencies, control spedalists employed by the private
sector to cope with regulatory matters can also be located in this same
space9These specialists are guided by complex technical and professional
standards. While this expertise makes them more flexible than
Linder and Peters 135

bureaucratric agencies, their professional standards make them less flex-

ible than organizations primarily responsive to private interests. The self-
regulating professions, e.g., law, affording less procedural protection and
accountability come next in this space, followed by private groups, e.g.,
industrial trade associations, offering greater flexibility but still less pro-
cedural protection or accountability. Finally, in the upper left, appear
individual producers and consumers with greater flexibility but virtually
no accountability. Thus, by examining this space, one gains a good idea
of the nature of the constraints an actor or set of actors face, and hence
some idea of their likely behavior under different regulatory designs.
Instrument 1: The Rule. The second feature of control-setting mecha-
nisms is the rule, an instrument for constraining behavioral choices or
private transactions. Again, a sample of appraisal criteria can be drawn;
for instruments, however, the line between procedural and substantive
criteria is blurred. Although applying any instrument entails procedural
elements, especially when the promulgation of rules is considered, these
elements are generally attributed to the actor rather than the instrument.
To simplify matters, the appraisal criteria presented here were chosen to
reflect those attributes of rules likely to play an important role in their
promulgation, and in their acceptability.
The degree of intervention as a criterion refers to the rule's level of
intrusion into private affairs. At the lowest degree of intervention, rules
merely offer information to private parties which can be either used or
ignored; higher levels of intrusion involve influencing transactions and
finally the preemption of choices. Intrusiveness involves several values.
Increasing intervention supplants individual autonomy and, in some in-
stances, may attenuate moral claims and redefine legal ones. Such a sac-
rifice of individual rights demands a strong moral justification (even if
one is not a committed individualist a la Nozick), based on the nature
and seriousness of the problem at hand. Here consent becomes an impor-
tant mitigating factor, legitimatizing the decisions of actors who are more
accountable.
Justifying a particular degree of intervention, therefore, cannot be
separated from designating the actor with responsibility for intervening.
Everything else being equal, we will feel more comfortable whenever the
actors who promulgate rules that involve substantial intrusion into pri-
vate affairs are highly accountable to the public. For example, most citizens
are willing to accept more intrusive rules (tax laws, criminal justice, etc.)
when these are administered by accountable, public organizations rather
than by private organizations. This is true even if there might be effi-
ciency gains from privatization of those functions.
Appraising forms of intervention also entails consideration of other
attributes, such as fairness, that can be considered apart from the
rulemaker. Fairness, in this context, demands equality of treatment for
those affected by rules. Of course, the process of ultimately choosing a
rule may or may not be fair--an issue of legitimate policy-making rather
136 Knowledge and Policy / Spring-Summer 1991

Figure 2
An Appraisal of Potential Rules
D E G R E E OF INTERVENTION

prohibitions
. quality controls
.~.quantity controls
price controls.
I
subsidies / t a x e s & charges
& grants ~.
~kl common law remedies
entry restrictions ,~

disclosure ,~t administeredcontracts

~ requirements
~t~information

INCLUSIVENESS PRECISION

(" . . . . . UNIFORM -" 9- - PARTICULARIZED ..... .~

than of the analytical crafting of alternatives--but the rule itself may

affect fairness as well. A fair rule will treat relevantly similar cases equally,
calling for impartiality. Conversely, dissimilar cases deserve different
treatment depending upon the extent of their differences, calling for ex-
ceptions to impartiality. An impartial rule is reliable and consistent but
not responsive to special cases or special pleadings. In a sense, it sacri-
rices precision for inclusiveness. Thus, perceived fairness in rule applica-
tion would appear to depend upon whether one wanted to receive or
avoid the treatment offered by the rule. In practice, a fair rule will respond
to both considerations, balancing impartiality against precision. Fairness,
in a sense, expresses tolerance for certain kinds of error. Too impartial a
rule generates a disproportionate number of false positives (incorrect
inclusions in the class of cases treated by the rule) while too particularis-
tic a rule errs in favor of false negatives. One's view of fairness, then, is
affected by the relative weighting of these two kinds of error.
The ordering of rules according to their appraisal criteria appears in
Figure 2. The rules intended to facilitate transactions appear in the lower
part of the space. This region includes information and education (Adler
and Pittle, 1984) and administered contracts (Goldberg, 1976). Adminis-
tered contracts include insurance and compensation schemes as well as
programs defining new property rights, such as tradeable pollution per-
mits. Remedies for information asymmetries (Vining and Weimer, 1988)
Linder and Peters 137

Figure 3
An Appraisal of Potential Enforcers
FLEXIBILITY
~-first party
(

"~ PROCEDURAL PROTECTION

~ r third partyt/,~r second party

ACCOUNTABILITY
come next, including entry restrictions such as licensure and certification
as well as mandatory disclosure rules. Near the middle of the space one
finds rules for valuing gains and losses from certain transactions. Com-
mon law remedies--liability and negligence--begin this segment, fol-
lowed by rules for discounting losses (grants and subsidies) and for dis-
counting gains (taxes and charges). As we approach the top of the space,
rules become increasingly intrusive, limiting choices regarding production
and consumption of particular products. Rules for restricting prices come
first, followed by rules governing quantity (such as performance stan-
dards and output quotas) and finally rules specifying quality (such as
design standards). These are followed by rules proscribing production or
consumption together.
Near the middle of the space there appears to be a transition between
market-adjusting rules and those that replace features of the market. Re-
ducing the variety of rules and their potential combinations with
rulemakers to a market vs. non-market dichotomy, however, is mislead-
ing. In effect, each rule has both market and non-market aspects that
appear in different proportion depending upon the rulemaker and the
circumstances. As with other design choices, it is not so much a dichotomy
as a matter of degree. Instead of an abrupt split between market and non-
market rules, Figure 2 suggests a simple association between degree of
intervention and the relative balance between inclusiveness and preci-
138 Knowledge and Policy / Spring-Summer1991

sion. As rules become more inclusive and less precise, they also appear
to become more intrusive. Greater intrusiveness, perhaps, is the price of
more inclusive, uniform rules. In effect, the bluntness of a rule is com-
pensated for by the larger scope of its intrusion. It may appear harsh, in
other words, but all or most all are treated equally by it.
Actor 2: The Enforcer. As with rulemaker and rule, an enforcer controls
the application of an inducement. The rulemaker may be responsible for
choosing the inducement, but the enforcer decides when and if it should
be applied. Enforcement, then, involves the enforcer's readiness to im-
pose sanctions, as well as the ability to detect rule violations. Some en-
forcers are clearly more flexible than others in using sanctions to affect
compliance. Some, for example, may be more willing to give offenders a
second chance, or to tolerate some non-compliance when parties make
"good faith" efforts to comply. Others eschew cooperative settlements
and ignore mitigating circumstances (Bardach and Kagan, 1982). As with
rulemakers, enforcers differ in terms of accountability and procedural
protections offered to regulated parties. We can expect the same kinds of
tradeoffs between those criteria as with rulemakers.
Three types of enforcers are considered here, each type corresponding
to a particular delegation of enforcement responsibilities. Under first-
party enforcement, the regulated party assumes responsibility for moni-
toring and enforcing its own compliance, including cases in which the
regulated party is also the rulemaker (professional organizations). First-
party enforcement is likely to appear most reasonable to the regulated
party, but is also likely to be the least accountable. In second-party en-
forcement, the rulemaker itself assumes responsibility for monitoring and
sanctioning noncompliance. This is the most accountable arrangement
and probably offers the most procedural protection. Under third-party
enforcement, the rulemaker relies on independent actors, other than the
regulated party, to enforce compliance. While accountable through their
contractual arrangements with rulemakers, third-party enforcers are not
necessarily flexible in their use of sanctions or concerned with due pro-
cess. Each of these enforcers has a different stake in the application of
inducements; our ordering of enforcers appears in Figure 3.
First-party enforcement places the regulated party in the position of
deciding whether to sanction itself; if it fails to do so in appropriate cases,
the privilege of self-enforcement may be revoked--an inducement of sorts.
It should be noted, however, that the monopoly of information held by
some first-party enforcers may make implementation of this inducement
unlikely. Second-party enforcers are concerned enough with compliance
to be vigilant enforcers, but face competing demands. Accountability in-
clines some rulemakers to flexibility, but centralization can undermine it.
The net result is likely to be a moderate level of reasonableness below
that of first-party enforcers. Incentives for third-party enforcers may take
the form of a bounty, a share of the penalty collected from noncompliers,
or of service norms associated with private enforcement professions such
Linder and Peters 139

as accounting. Because of their profit motive, using third-party enforcers

can improve detection, and standardizes the application of inducements
more than can second-party enforcement. In other situations, reliance on
aggrieved parties for enforcement can offer compensation as an incentive
(Lott and Roberts, 1989).
Instrument 2: The Inducement. An inducement is intended to serve as
both a punishment for noncompliance and a deterrent to noncomplaint
behavior in general. Inducements can be positive, reinforcing compliance
through rewards, or negative, punishing noncompliance through various
penalties. Representing the variety of inducements only by differences in
the size of fine, however, fails to accommodate the widespread use of
rewards as inducements. One way to capture both rewards and penalties
along a single dimension is to represent types of inducements as levels of
cost, including opportunity costs. Positive inducements, such as trust,
praise and subsidy, impose opportunity costs if withdrawn for noncom-
pliance. Conversely, negative inducements impose costs when applied.
Inducements not only can be ordered by increasing cost, but can be
subjected to the same criteria used to appraise rules (see Figure 4). Infor-
mal forms based on self and peer attitudes appear in the lower left,
including positive inducements, such as moral commitment and trust,
and negative ones such as threatened disclosure, stigma, and social dis-
approval. These are followed in order by various financial payments.
Fixed fines or subsidies come first, followed by compensation rewards
and penalties reflecting damage suffered or inflicted upon others. Other
legal remedies, such as restraining orders and injunctions, appear in the
upper right of the space, followed by suspension or attenuation of entitle-
ments. In this context, an entitlement might include a license or permit as
well as property rights. Finally noncompilers may be subject to confine-
ment or imprisonment.
There is an association between level of costs imposed and the balance
between precision and inclusiveness; it reverses direction from the asso-
ciation observed in Figure 2. Here, the more precise the inducement, the
heavier the sanction appears. The pattern of compensation tying more
inclusive rules to higher degrees of intervention no longer applies. In-
stead, the imposition of increasingly severe sanctions appears to warrant
greater precision. In effect, the socially appropriate balance of false posi-
tives and false negatives reverses from favoring one to favoring the other,
depending upon whether we are dealing with well-intentioned intrusions
into private affairs or the imposition of negative sanctions. This is mirrored
in the protections built into criminal law versus the degree of monitoring
of social policies. This balance has interesting implications for the pairing
of rules and inducements (see below). Further, this reversal may itself be
based upon a normative evaluation of the rights of individuals and the
obligations of governments to protect those rights.
140 Knowledge and Policy / Spring-Summer 1991

Figure 4
An Appraisal of Potential Inducements

OPPORTUNITY COST

detention .,)..)~.

graduated award -~.)~. -)K-',... change entitlement

fixed award -~.)~. restraining order
publicity..~.)~

"~',N_ moral suasion

-1 I
f

INCLUSIVENESS PRECISION
("..... UNIFORM . . . . . . PARTICULARIZED ..... 3,

The Design Ensembles

In this section, we bring together rules and actors into to ensembles,

one for setting controls and another for insuring compliance. We have
already pointed to some of the tradeoffs implied when actors and instru-
ments are brought together, and then linked to evaluative criteria. These
will become even more evident in the discussion that follows.
Ensemble 1: The Control-Setting Mechanism. Consider the design features
of control-setting as axes of the conceptual design space appearing in
Figure 5. Each possible rulemaker-rule pair can be viewed as an unique
control-setting mechanism. From the designer's perspective, the points
along these dimensions represent the range of plausible actor and instru-
ment forms. The positions of the most familiar of these are labeled along
the axes. The most familiar combinations appear to lie along a diagonal
running from the lower left to the upper right of the space. At the lower
end of that diagonal are contracts of various sorts administered by pri-
vate groups. These include, for example, insurance and other compensa-
tion schemes offered by employers to employees. Next, professional as-
sociations control licensing and certification requirements and set guide-
lines for acceptable practice. Near the center of the diagonal, the courts
are rulemakers applying liability and negligence rules to compensate for
harms inflicted by individuals. Finally, at the upper end of the diagonal,
 Linder and Peters 141

Figure 5
The Control Setting Design Space
Case 2
RULEMAKERS~ ChangeR u l e - - ~ - ~ - ~
federal gov't * ~ 0 O

state & local gov't

Case 1
~
1~
0 Case 3 //
Change Rulemaker /
Change Rulemaker 0 & Rule J
judicial system
v'
control specialists

professional associations 0 *

private groups 0

individuals

RULES

federal agencies impose safety and design standards and directly allocate
responsibility for reducing harms.
When attention is limited to those well-known mechanisms--the small
circles in Figure 5--movement within the design space is effectively re-
stricted to the diagonal. Alternatively, we can approach the selection of
an appropriate mechanism by moving parallel to one of the two dimen-
sions, inquiring, for example "what is the best rule for a given rulemaker?"
Studies comparing quality controls to taxes and charges, for example,
implicitly apply this approach to designing environmental policy. Con-
versely, we might ask "who is the best rulemaker for a given rule?"
While the actor and instrument biases examined earlier may still deter-
mine the desirable locations within the design space, at least in this context
they do so explicitly and with open consideration of the underlying ap-
praisal criteria and their tradeoffs.
Parallel movement along the axes generates restricted comparisons,
effectively holding a given design feature and its associated attributes
constantmthese are "local" as opposed to "global" comparisons. In con-
trast, less restricted movement throughout a given region entails "glo-
bal" comparisons along all attributes at once. To the extent that tradeoffs
among criteria are clear, such movement is both feasible and informative;
142 Knowledgeand Policy/ Spring-Summer1991

otherwise, local comparisons based on a criterion-by-criterion assessment

may be the only optior,. Accordingly we can expand our consideration of
control mechanisms by focusing on selected regions of the design space.
The numbers appearing in Figures 5 and 6 suggest plausible designs that
can be evaluated relative to the more conventional ensembles; the latter
appear near the diagonal and serve as reference points for comparison.
As we move away from a given reference point we alter the relative
combinations of procedural attributes represented by that point. Whether
this movement represents a relative improvement will depend, of course,
upon an earlier appraisal of individual design features. Further, since the
ordering of rules and rulemakers along the axes of the design space is
linked to a particular weighting of procedural criteria, movement in the
space corresponds to the manipulation of selected procedural attributes
and thus to the assumption of a new pattern of tradeoffs.
Case I: Change in Rulemaker--A Local Comparison. Starting from a posi-
tion on the diagonal at the rule "common law remedies" and the rulemaker
"judicial system" in Figure 5, we can consider a change in the rulemaker
that would both expand the scope of this rule's application and enhance
its accountability. State and local governments in the United States have
begun to experiment with compensation rules that were once limited to
tort litigation. Governmental authorities now act as brokers at the local
level between firms or officials trying to find a suitable location for objec-
tionable facilities, such as incinerators or toxic waste dumps, and the
community seeking to protect their health, real estate values, and other
local amenities. Unlike the remedies assigned by courts for damages that
have already occurred, compensation in this instance would be prospec-
tive and might involve investments in local infrastructure, schools, parks,
or recreation facilities. In exchange for accepting the facility, the commu-
nity would require the firm to offset indirect costs through compensation
to be supervised and, if necessary, enforced by the government officials
doing the brokering. The alternative to this change in rulemaker uses the
courts and litigation as both a remedy and a deterrent to any consequent
harm to the local citizens or their economic interests. The most obvious
difference between a state-brokered settlement and a court-sponsored
one is the element of political accountability in the negotiation process
and the range of possible resolutions. Further, it is quite possible that the
state can broker and enforce such an agreement far more cheaply than
the combined costs of litigation and attorney's fees that the more formal
route entails.
Case 2: Change in Rule--A Local Comparison. The next case shown in
Figure 5 involves the federal government as rulemaker in two instances
under a change in rule. The classic mode of command-and-control regu-
lation in the United States combines the federal rulemaker with standards
governing industrial activities, ranging from chemical exposure in the
workplace to product attributes. As noted in Figure 2, these standards
are inclusive (admitting few exceptions), are intended to apply uniformly
Linderand Peters 143

without regard to local circumstances, and represent a relatively high

degree of intervention in a firm's decision-making. If we choose to re-
verse the direction of all three of these criteria at once, we come to a rule
such as "administered contracts" that replaces formalized standard-set-
ting and application with a more particularized process of informal bar-
gaining. In effect, each firm negotiates a level and schedule of compliance
best suited to its individual circumstances, or to those of its workers and
customers, but is also called to account for any violations of earlier stan-
dards and for its past efforts to achieve compliance. This precision permits
the rulemaker to distinguish between "good faith" compilers attempting
to to meet standards, anticipating full compliance in the near future, and
those firms simply avoiding the standard altogether to preserve their
competitive advantage (See Perritt, 1986).
Case 3: Changes in Rulemaker and Rule--A Global Comparison.
Finally, consider the comparison between the federal government as
rulemaker employing quality controls and several other ensembles de-
picted in Figure 5 designed to perform the same function but in different
ways. Changing both rulemaker and rule at the same time, however,
involves manipulating at least 5 or 6 explicit criteria (and no doubt some
additional implicit ones) at once. Situations like this present the most
demanding test of our spatial heuristic: "Does it offer an effective means
of keeping track of the design trade-offs at issue, aside from its value in
structuring the range of choices among design elements?" The conven-
tional substitute for quality controls is a tax or charging scheme (Kneese
and Schultze, 1975); note that the rule changes but not the rulemaker. The
criticisms of quality controls are invariably confounded with criticism of
the federal government as rulemaker. Changing the rule alone may not
solve the problems that were due more to the rulemaker than to the rule
in the first place.
An alternative ensemble would combine a cadre of control specialists
with quantity controls. In the rulemaker we sacrifice a measure of ac-
countability and procedural protection for an increase in flexibility and
local discretion. How much accountability and due process protections
are sacrificed will depend in large part of how this discretion is struc-
tured; a well-trained, professionalized inspectorate, as Bradach and Kagan
(1982) argue, may be better equipped to employ "reasoned regulation"
than the detached official at the central office who knows little of the
opportunities and constraints faced by prospective compilers in the field.
Combining the control specialist with a quantitative rule (i.e., compliance
is a matter of degree) could take full advantage of the meliorative aspects
of awarding discretion without forfeiting the intent of the legislature.
Alternatively, professional associations such as accountancy groups
may be given formal responsibility for establishing and monitoring com-
pliance through strict disclosure rules that would be a part of each firm's
(publicly held) annual audit. Poor compliance with environmental stat-
utes, then, might ultimately be reflected in a firm's standing in the equity
144 Knowledge and Policy / Spring-Summer1991

and bond markets. In this case, the rule has no direct effect but might
subsequently alter valuation of the firm's assets based on public reporting
of bad behavior. Whiie less intrusive, the rule also is less reliable and
depends on public reaction to sanctioned behavior. To the extent that the
professional associations setting and monitoring the standards are pub-
licly licensed, they may be held somewhat accountable but their principal
merit lies in their flexibility relative to formal governmental bodies.
Substantive Criteria for Control Setting. Defining an improvement in
substantive terms must be judged relative to additional criteria that speak
more directly to expected costs and consequences. Besides its appraisal
in procedural terms, a movement from one location to another in the
design space may represent a potential Pareto improvement, depending
upon assumptions about the direction of expected changes in relative
costs (Mishan, 1981). Conversely, substantive judgments about expected
impact may effectively be held constant across a small subset of designs
in order to focus on prospects for procedural improvement.
Consider, for instance, suggestions from the property rights literature
(Furubotn and Pejovich, 1972) for the efficient allocation of risk. To the
extent that transaction costs can be restrained, bargaining among private
parties will in theory generate an efficient risk-sharing arrangement. As
can be seen from its position in the design space, however, this arrange-
ment offers relatively limited accountability, suggesting its inappropri-
ateness in situations of extensive social harms. Similarly, the relative ab-
sence of procedural protections would require careful attention to prob-
lems of disproportionate bargaining strength between parties.
As a second example, consider the resource demands of a control-
setting mechanism intended to alter the behavior of certain parties--at
times, against their will. Each mechanism must generate information suf-
ficient to set appropriate levels of control and to establish compliance
requirements. While information on whether a rule is obeyed comes from
the compliance mechanism, a rulemaker must determine whether a rule
is working as intended. If it is not, information is needed to make neces-
sary adjustments. The costs of this information will vary with the com-
plexity of the rule and with the rulemaker's capacity for gathering and
processing information. Thus, regions in the design space that combine
rules requiring extensive fine-tuning with rulemakers who are ill-equipped
for this task are likely to represent excessive costs for a given level of
control.
The resource demands of a given rule will also vary with its degree of
intervention. Less intrusive rules require less information since they place
fewer requirements on the behavior of the regulated party. As the degree
of intervention increases, however, regulated parties are likely to become
less cooperative and less complaint, raising information costs. Rule selec-
tion is constrained by costs associated with the rule's enforcement. Sensi-
tivity of the designer to resource demands of control-setting mechanisms
Linder and Peters 145

changes as the severity of harm escalates. Cost considerations are likely

to be suspended in emergencies, permitting movement to the upper
boundaries of the control space. For severe harm, information becomes
less important, as timely action takes precedence over the need for fine-
tuning. Consequently, the costs of complex or intrusive rules diminish
relative to other types of rules. Decreasing harm is likely to have the
opposite effect, with the resource requirements of imposing and main-
taining highly intrusive rules becoming difficult to justify.
Any appraisal of social costs from market imperfections (a prototypi-
cal design problem) must be balanced by the recognition that flaws in the
interventions for correcting these imperfections (the prototypical solu-
tion) carry costs that may exceed the costs of the original imperfection
(Wolf, 1979; 1988). Accordingly, our appraisal of actors and instruments
should consider the potential costs generated by their joint activity as
control-setting and compliance mechanism, in addition to their adminis-
trative costs. The earlier ordering of actors and instruments along different
procedural criteria necessarily implied some notion of relative cost. As
we moved downward and to the right in the rulemaker's space in Figure
1, for example, we sacrificed flexibility in order to gain a measure of
accountability. In appraising mechanisms, attention shifts to the resource
demands associated with complexity (an administrative cost), the poten-
tial for resistance (an enforcement cost), and the severity of social harm
defining the problem (i.e., the cost of market imperfection).
In general, a thorough substantive appraisal requires a well-defined
set of performance objectives. Once the appropriate objectives have been
specified and the proper solution conditions met, a "best" mechanism
can be identified along with optimal levels of enforcement. Without
agreement on these objectives, however, establishing proper grounds for
judging relative, substantive improvements within the design space be-
comes troublesome. Nonetheless, by employing a heuristic such as our
conceptual design space, the valuative basis of disagreements becomes
explicit. Arguments over design then can focus on appraisal criteria, and
on the performance attributes of alternatives, rather than on less produc-
tive clashes of incompatible biases.
Ensemble 2: The Compliance Mechanism. The potential combinations of
enforcers and inducements as compliance mechanisms appear in Figure
6. Following our analysis of the control-setting mechanism, we can iso-
late several familiar examples of compliance mechanisms by focusing on
the main diagonal. At the lower left, the compliance mechanism combines
first-party enforcement with moral suasion as an inducement. This cat-
egory includes self-regulating associations that use censure or appeal to
professional values as devices for ensuring compliance, as well as trade
associations that rely upon peer pressure and group norms. The media
provide one example of a third-party enforcer using stigma or damage to
reputations as a device for ensuring compliance with rules. At the upper
end of the diagonal in Figure 6 falls the second-party enforcer imposing
146 Knowledge and Policy / Spring-Summer1991

fixed fines and subsidies upon regulated parties. This is certainly the
largest category of compliance mechanisms, encompassing most of
government's regulatory activity. Further, it also represents a higher level
of deterrence relative to the cases falling at either end of the diagonal.
As we move to off-diagonal combinations, several plausible mecha-
nisms come to mind. In the area below the diagonal lie inducements that
are more precise and relatively more punitive than those normally asso-
ciated with the corresponding enforcers. Here the idea is to alter the
deterrence offered by a given mechanism through an increase in the
expected sanction. Alternatively, a move above the diagonal represent a
preference for a less flexible but potentially more aggressive enforcer
(Polinsky, 1979). Deterrence, in this instance, is likely to increase with the
higher probability of detection offered by third-party enforcers.
Case 4--Changing the Enforcer. Most governments in industrialized de-
mocracies have encountered an increased need to collect as much tax
revenue as possible during the 1980s. One option they have exercised is
to use tax amnesties to encourage taxpayers who have evaded taxes in
the past to come forward to pay their delinquent taxes. The governments
have agreed not to charge penalty or interest, and not to prosecute as
evaders those who pay. This is clearly a change from government en-
forcement to first-party enforcement of tax laws, albeit with government
providing a substantial inducement to the taxpayer. This device has been
used successfully in several American states (MikeseU, 1986), as well as
in European counties, including Austria and Italy.
The device of the amnesty might be extended to first-party enforce-
ment in areas of social regulation such as pollution control. One consis-
tent problem encountered in dealing with hazardous waste disposal is
the absence of adequate information about illegal dumping. Therefore,
an amnesty program for "midnight dumpers" could be instituted to col-
lect the needed information. This might offer protection from prosecu-
tion in exchange for information about potentially dangerous dumping
sites. There may have to be a time limit on the program, in order to
prevent repeated illegal dumpings followed by repeated confessions. There
are, however, real possibilities for coping with an extremely difficult
enforcement problem in the area of social regulation by using this unusual
instruments.
Substantive Criteria for Compliance Mechanisms. Once again, we can ex-
amine resource demands of mechanisms by attempting to rule out those
that fail to provide reasonable levels of coordination and information. In
the enforcement context, information is required not only for detecting
noncompliance, but also for deciding when to impose a given induce-
ment. Coordination, on the other hand, refers to the burden of adminis-
tration. For a given choice of enforcer, as we move up along the opportu-
nity cost dimension, both coordination and information burdens increase.
The more severe the sanction, the more likely is the enforcer to encounter
Linder and Peters 147

resistance by the noncompiler. For any particular inducement, increasing

the likelihood of enforcement would typically require more information
and better coordination. However, including a private, profit-motivated
actor among our enforcers disrupts this pattern. Moving from first- to
second-party enforcers clearly increases the demand for coordination and
information. Conversely, in moving from second- to third-party enforc-
ers, those requirements are likely to diminish or, at worst, to remain the
same.
Once again, increasing levels of harm increase the relative importance
of information and coordination, favoring stringent inducements. For the
choice of enforcers, the level of harm influences incentives of third-party
enforcers to a greater extent than it influences other enforcers. As the
level of harm increases, fees for third-party enforcement will eventually
exceed those of second-party enforcement, making government the less
expensive enforcer. It may be, for example, if tensions in prisons con-
tinue to escalate, that private prisons no longer will present the cost
advantages they did in the late 1980s.
For each choice of compliance mechanism there is a corresponding
tradeoff between the probability of detection and the level of opportunity
costs. As we move to higher levels of both components--toward the
upper right of Figure 6---we are increasing the detergent to noncompli-
ance by raising expected opportunity costs. Also, as pointed out earlier,
there is a symmetry in the relation among procedural attributes for rules
and inducements, one having the opposite direction of the other. Any
coupling of compliance- and control-setting mechanisms must account
for this pattern, which reflects basic notions of fairness. In general, pair-
ing an inclusive rule with a precise instrument, or precise rules with
inclusive inducements will balance conflicting preferences for different
types of error.

Prospects and Conclusions

Our analysis has highlighted certain regions in the conceptual design

space for special consideration, but deciding on a particular policy alter-
native as "solution" is the selection of a single point in this space. How
one converges on this point is a disputed matter; the convergence may be
unconscious and determined by biases or it may be conscious, resulting
from an explicit and systematic design process. Formalists, armed with
an objective function, can readily converge on a "best" solution.
Proceduralists, on the other hand, place their confidence in a process for
defining what is "best" relative to what has been suggested by the par-
ties to the procedure. The spatial design heuristic presented here represents
an alternative way to guide and promote this convergence.
In contrast to either a process in the policy-making cycle or an exercise
in building an optimizing model, design entails the invention and link-
ing of various policy forms (many of which are blueprints for untried
148 Knowledge and Policy / Spring-Summer

Figure 6
The ComplianceDesignSpace

ENFORCERS

secondparty 0
!
third party Case 4
0
Change Enforcer
$
first party 0

I i' I I ! I I INDUCEMENTS

alternatives) with explicit normative requirements. The creative aspect of

design arises not only in the systematic development of new forms and
in the discovery of new and less obvious linkages, but in the comparative
appraisal of forms along a common set of explicit criteria. In this regard,
the design task has a closer resemblance to fashioning a recipe than to
planning a menu. The elements of design suggested here, decomposition
of problem requirements into criteria and design features followed by
logical reconstruction of ensembles, guard against biases in several ways.
First, the process of reaching insights, drawing inferences and making
associations concerning policy alternatives is externalized in logical form.
The process is aided by a general heuristic that both demystifies thinking
about the problem and open it to shared deliberation. Second, the
designer's assumptions and values are made explicit and their application
to alternatives is structured systematically. Finally, based on these fea-
tures of design, the linkage between problem definitions and the alterna-
fives being considered for their remedy can be subjected to conscious
control and, possibly, replication.
In any democratic political system there are bargaining and adjust-
ment among alternatives in policy-making. What appears absent, how-
ever, is guidance for the initial statement of the alternatives to be consid-
ered in that process. It may be (Campbell, 1969) that reforms are all
experiments, and that the successive decision-making that appears to
Linder and Peters 149

characterize democratic policy-making will correct deficiencies in the

policies adopted. Even if this were true, and inferior policies did not
b e c o m e e n t r e n c h e d t h r o u g h custom, acquired rights or w h a t e v e r
(Hogwood and Peters, 1985), this remains an inefficient means of at-
tempting to solve social problems. The policy sciences may not be able to
issue absolute guarantees for the efficacy of any prescription they made,
but should have at least some idea of the presumed impact of any remedy
they offer.
The process of "designing" public policy represents an aesthetic of
"second best" alternatives; it offers a mechanism for recognizing and
separating good designs from bad ones without need for elaborate ma-
chinery of decision-making and without precommitment to a particular
set of alternatives. At best, design drives out the arbitrary and ad hoc and
exposes the counterfeit. In the process, procedural and substantive val-
ues are explicitly incorporated into alternatives, and perhaps new forms
with healthy prospects also emerge. In any event, we can approach the
design problem from the perspective of either explanatory or prescriptive
theory, guided by a design logic that highlights the ingredients of a more
systematic way of developing plausible designs.
We make no attempt to substitute policy design for conventional ways
of making choices among pre-existing alternatives, nor to replace the
quantitative techniques for predicting their performance. The underlying
stipulation is simply that conscious attention to design as a comparative,
analytic task prior t o t h e assembly and analysis of the usual set of alter-
natives should produce a better-performing set of alternatives that un-
conscious design or no design at all. It is this self-conscious and system-
atic approach to the development of alternatives that separate policy
design from other work on the formulation of alternatives in policy
analysis. There is no guarantee of producing the "best" solution but,
instead, reassurance that the elaboration of alternatives was balanced
rather than biased and that their comparative assessment was thorough
and open to comment and criticism.

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Minerva
A REVIEW OF SCIENCE, LEARNING AND POLICY

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Contributions to Volume XXVIII 1990 included:

Alvin M. Weinberg: Technology and Democracy

Pamela Spence Richards: The Movement of Scientific Knowledge from and to
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William A. Cummings: The Culture of Effective Science: Japan and the United
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Kingsley de Silva: The Sri Lankan Universities from 1977 to 1990: Recovery,
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A. Hunter Dupree: Science Policy in the United States: The Legacy of John Quincy
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Heinz Maier-Leibnitz: The Status of Academic Research in the German Federal
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Allan Mazur: Nuclear Power, Chemical Hazards, and the Quantity of Reporting
Malcolm Richardson: Philanthropy and the Internationality of Learning: The
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Terry Shinn: "Formation par la recherche": Technological Training Through
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Reports and Documents: Confidentiality of Assessment by Peers---Harvard
Guidelines on Dissent--Progress of Affirmative Action
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