A great new working paper by Brian C. Albrecht, Joshua R. Hendrickson, and Alexander William Salter. Below, find the abstract for the paper, Evolution, Uncertainty, and the Asymptotic Efficiency of Policy
Politics, like any social process, involves selection mechanisms that determine whether the
outcomes of the process are efficient. This paper presents a model of politics as an evolutionary
process. The decisions of interest groups to enter politics determines the selected policy. Our model
leads to three main results. First, the political process selects for efficient policies in the long run. This
mirrors how markets select for efficient firms. We call this attribute asymptotic efficiency. Second, the
bargaining of interest groups bounds the level of inefficiencies that can exist in the short run. The bound
decreases when organizing interest groups becomes less costly. Finally, policies that appear inefficient
in a static analysis can be efficient once economists consider the dynamic nature of political decisions.
We argue that viewing the political process as a selection mechanism allows political economists to use
efficiency as a tool for positive economics. In our approach, applied political economy involves looking
for relevant costs that make the policy efficient. However, our approach does not rob political
economists of the ability to make meaningful normative statements, but only constrains the type of
The Center for Innovative Governance Research is pleased to announce our Technology Zones White Paper Competition: “Towards a New Regulatory Framework”. The winner will receive a $10,000 prize and second place will receive a $5,000 prize.
Technological progress in the U.S. is stagnant. America’s technological stagnation is responsible for both the decay of our global technological leadership and the increasing concentration of industry in a few geographical hotspots.
Our burdensome and increasingly outdated federal regulatory system bears some responsibility for this slowdown. The modern American administrative state was built during an era in which most innovations came from large, slow-moving corporations, at times in conjunction with the government. But this is no longer the case, and as the nature of innovation changes, so too must our regulatory system. Reversing course requires a bold, new regulatory framework.
Technology zones are one such option. Practically, they provide a mechanism to test and experiment with different regulatory approaches to emerging technologies. Marc Andreessen’s Politico essay, “Turn Detroit into Drone Valley” offers a compelling argument for technology zones:
“the focus is more on driving regulatory competition between city, state and national governments…[r]ethinking the regulatory barriers in specific industries would better draw the startups, researchers and divisions of big companies that want to innovate in the vanguard of a particular domain—while also exploring and addressing many of the difficult regulatory issues along the way.”
Technology zones are federal legislation that allows for new regulatory policies for cities, states, and other jurisdictions. Unlike opportunity zones which prioritize tax breaks, technology zones can create geographical clusters in emerging technologies, like biotech and drones, dispersing jobs and talent throughout the U.S.
The goal of this white paper contest is to impact policy. The ideas proposed should be actionable, such that enterprising policymakers could adopt them. Papers should be written in a style considered publishable by a think tank, but we will stop short of offering rigid formatting guidelines. For a great example of what we’re looking for, please see “Make America Boom Again”.
White papers should be 30 pages max and include:
- Demonstrable knowledge of emerging technologies
- Clear explanation of how the existing regulatory framework limits innovation
- Proposal for a new regulatory framework
- How the technology zone would accelerate innovation in the emerging technology
- Suggested metrics for success for the technology zone
Emerging technologies include, but are not limited to:
- Gene therapy
- Self-driving cars
- Drugs and medical devices
The first- and second-place winners will receive prizes of $10,000 and $5,000, respectively. Submissions will be judged by Tyler Cowen, Professor of Economics at George Mason University and General Director of the Mercatus Center; Eli Dourado, Head of Global Policy and Communications at Boom; and Joe Lonsdale, co-founder of Palantir Technologies and co-founder and General Partner of 8VC.
The winners will be announced during a public event—date TBA—hosted by the Center for Innovative Governance Research with journalists, Hill staffers, and other interested parties in attendance to discuss how zone-based regulatory reform can revitalize struggling communities and help America retain its global competitive edge in technological innovation.
Please email submissions to Mark@InnovativeGovernance.org by March 17th, using the subject line ‘Contest – [Paper Title]’. Please do not include your name or affiliation in the white paper, as judging will be blind.
We would like to thank the Charles Koch Foundation for sponsoring this contest.
This week’s guest on the Innovative Governance Podcast is Santiago Gangotena. Santiago founded the Universidad San Francisco de Quito, the first entirely private university in Ecuador. In this episode we discuss how Santiago built the Universidad San Francisco de Quito from scratch, attracted thousands of students, and dealt with challenges posed by the government and other universities.Read More