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What You Can Learn From the Rise of "Moneyball Government"

What state, local, and international governments know about making smart decisions.

The federal government is not the sole player in the growing movement toward the use of evidence and evaluation in the policy decision-making process. While the federal government is undertaking a number of evidence-based program initiatives, the “moneyball government” movement is broader, encompassing initiatives at the state, local, and even international levels. Feds can learn a lot from taking notice of these local and international efforts:

Examples of State-Level Efforts

Oregon Education.  The Oregonian reports that this fall, Portland State University doctoral students will “serve as a research arm of Portland Public Schools and five other” local school districts to conduct “program evaluations and other data-driven studies of what is working, and what isn’t, in local school districts.”   The research effort is being funded by a grant from the Portland-based testing agency, Northwest Evaluation Association.  Research will include, for example, a study of techniques being used by different schools to improve sixth-grade attendance. 

Washington State Institute for Public Policy.  The Washington State Institute for Public Policy has developed system for calculating the return on investment from alternative public policy tools that is being used by the state legislature to help make policy decisions based on performance rather than anecdote. Institute director Steve Aos says that building relationships is as important as building technical capacity.  According to the Pew Center for the States, the Institute has developed a unique approach to supporting the policy decisions by the state legislature, which includes:  

  • analyzing all available research to systematically identify which programs work and which don’t;
  • predicting the impact of policy options for Washington State by applying the combined evidence of all sufficiently rigorous national studies to the state’s own data; and
  • calculating the potential return on investment of policy options, taking into account both the short and long term and the effect on taxpayers, program participants, and residents who are most directly affected.

Since developing this approach for juvenile justice programs, the Washington State legislature has directed the Institute to apply the same benefit-cost approach to other areas of public policy, including K–12 education, early childhood education, child welfare, public health, public assistance and employment, mental health, and substance abuse. 

The Pew Center on the States is providing technical assistance to expand use of this cost/benefit approach to other states. A pilot group of 14 states—Connecticut, Florida, Idaho, Illinois, Iowa, Kansas, Massachusetts, Mississippi, New Mexico, New York, Oregon, Rhode Island, Texas and Vermont—has made this commitment and is working to adapt the Washington State model.

Social Impact Bonds Being Piloted in States.  The Washington Post reports that “Six states are moving to develop so-called social impact bonds [see below for more details], marking a broad expansion of an experiment that taps private investors to fund capital-hungry social programs. . . . Connecticut, Illinois, New York, Ohio, South Carolina and Colorado won a competition initiated by Harvard University and the Rockefeller Foundation, which will provide them technical assistance with developing bond programs.”

Example of Local-Level Efforts

New York City.  According to Deputy Mayor Linda Gibbs, the city has committed to $100 million a year in evidence-based research and development initiatives through its Center for Economic Opportunity and has sponsored about 50 poverty-reduction projects.  Ten percent of its budget is reserved for evaluations, over an 8-year period.  The city has completed two rounds of competitions so far; and are about to start a third round. Similar efforts are underway in other cities, as well. The Center’s executive director, Kristin Morse, notes that it is important to stop what isn’t working so those programs that do work can be scaled up.

One of the Center’s most prominent initiatives is its efforts to pilot social impact bonds. According to a report by the Center for American Progress, social impact bonds are a new financing tool for social programs in which “government agencies contract external organizations to achieve measurable, positive social outcomes on key issues, such as homelessness or juvenile delinquency.” Payment by the government to the service providers is made only after the agreed-upon results have been achieved.

Mayor Michael Bloomberg announced the city’s first impact bond agreement in August 2012.   According to the Center for American Progress’ report:  “The city of New York contracted with MDRC, a nonprofit, nonpartisan social research organization, to reduce the rate of recidivism by at least 10 percent over four years among annual cohorts of about 3,000 young men exiting Rikers Island. The working capital for the intervention—$9.6 million over four years—is being provided by Goldman Sachs, structured as a loan to MDRC.”

The British Are Taking a Lead, As Well

The British government is also sponsoring a range of initiatives as well and there is now a non-profit Alliance for Useful Evidence that was inspired by the U.S.-based Coalition for Evidence-Based Policy.  The Alliance publishes regular reports with practice-based examples.

Prime Minister David Cameron has been a big supporter of social impact bonds and there are 13 projects “on the books” with another eight in the pipeline.  So far, investors have put up about £200 million in investment to support these projects.  The Office for Civil Society in the Cabinet Office is the key champion for the development of social impact bonds.  Minister Nick Hurd told a U.S. audience that they hope to deliver about £500 million in projects in coming months.

The British Cabinet Office also sponsors a Behavioral Insights Team, nicknamed ”The Nudge Unit” after a book by Cass Sunstein and Richard H. Thayler.  The unit: “applies insights from academic research in behavioural economics and psychology to public policy and services.”  For example, it examines ways to change peoples’ behaviors to reduce food wastage and to help jobseekers return to work.

If you are aware of other state, local, or international efforts, add them via the “comments” box below!