Discussion: Water Resources Management: Policy Economics for an Era of Transitions

Dr. Shabman has chosen to pass on the op- making as seeking incremental movement away portunity to identify the critical policy issues from problems, rather than striving to achieve to be confronted in the 1980's and instead chose some prespecified goal, i.e. that decisions aren't to address the art of policy analysis and the made, they just happen. strategy for political acceptance. He has done Based on this concept of incremental choice, an excellent job of providing a historical over- the role of the economist in policy analysis is view of water resource policy and points to to: (1) expand the range of choices to be conexciting times ahead for those economists who sidered as deviations from the existing situation are effective in designing water policy research and (2) provide advice to decisionmakers as to and in offering policy advice. how the concepts of opportunity cost, marginShabman begins by questioning the validity alism, and incentives may be applied to the of applying the rational-analytical decision current situation. model to government action. In the rational I have no problem with these roles; however, decision model, economists are looked to for in my mind they are equally applicable to either analytical expertise and provision of informa- the rational decision approach or the incretion as to the impacts of alternative actions. In mental approach--only the range of alternatives providing these services economists have de- considered would differentiate the two. veloped methods for valuing non-market goods, i developed new approaches for marginal cost Shabman goes on to address the importance pricing, and attempted to create markets or of ht he t s the ideological overtones quasi markets to increase the efficiency of gov- of the application of these concepts and he ernment actions. However, Shabman argues that seems to argue that if policy economists are to the result of this type of activity has been to be effective, they must not only recognize the provide policy advice which has fallen on deaf ideological perspective of the decisionmakers ears. they are dealing with, but they must also recTo correct our approach, Shabman offers an ognize their own ideological bias and somehow alternative mode of operation. He calls on pol- reconcile the two. icy economists to adopt a new approach to Shabman provides a history of water policy defining policy research problems and to be- from the days of Theodore Roosevelt and his come more attuned to the need for political resource conservation philosophy through the strategy in offering policy advice. He discards New Deal agencies of Franklin Roosevelt and the traditional rational decision model, states the environmental movement of the 1960's and that objectivity in policy research and advising 1970's. The changes in ideologies which have is impossible and provides what he terms "the occurred over time and the impact which these institutional model of the policy process" for ideologies have had on the effectiveness and us to accept and adapt our contributions to this the discretionary power of government agencies process. are emphasized. Public choice is based upon the process of In today's world Shabman argues, and I agree, incremental politics rather than the rational that there are no ideologically neutral policy decision model. Choices are made within a very prescriptions. Economists, if they are to be efnarrowly defined set of institutional constraints fective, must recognize the ideology implicit which will probably be changing over time. in their science. Expert advice from economists Shabman seems to accept and proclaim Wil- or other specialists is not accepted without davsky's and Lindbloom's definition of choice questions (I'm not sure that it ever was-even