How do governments determine policy priorities? Studying development strategies through spillover networks

Effective policy prioritisation is key to successful development strategies. Yet, from our experience consulting for governments and international organisations, it seemed that governments rarely enact the priorities they promote in public speech. At the time we wrote this piece, there was little data mapping budgets (the actions/priorities) into development goals (the aspirations). Hence, this was our first attempt to model the policy prioritisation process of a government with the aim of explaining the performance of its indicators. This work was the seminal piece that led to the growth of the Policy Priority Inference programme of research.

Determining policy priorities is a challenging task for any government because there may be, for example, a multiple objectives to be simultaneously attained, a multidimensional policy space to be explored, inefficiencies in the implementation of public policies, interdependencies between policy issues, etc. Altogether, these factors generate a complex landscape that governments need to navigate in order to reach their goals. To address this problem, we develop a framework to model the evolution of development indicators as a political economy game on a network. Our approach accounts for the –recently documented– network of interactions between policy issues, as well as the well-known political economy problem arising from budget assignment. This allows us to infer not only policy priorities, but also the effective use of resources in each policy issue. Using development indicators data from more than 100 countries over 11 years, we show that the country-specific context is a central determinant of the effectiveness of policy priorities. In addition, our model explains well-known aggregate facts about the relationship between corruption and development. Finally, this framework provides a new analytic tool to generate bespoke advice on development strategies.