<p><p><p>This paper develops a broad theme about policy choice under ambiguity through study of a particular decision criterion. The broad theme is that, where feasible, choice between a status quo policy and an innovation is better framed as selection of a treatment allocation than as a binary decision. Study of the static minimax-regret criterion and its adaptive extension substantiate the theme. When the optimal policy is ambiguous, the static minimax-regret allocation always is fractional absent large fixed costs or deontological considerations. In dynamic choice problems, the adaptive minimax-regret criterion treats each cohort as well as possible, given the knowledge available at the time, and maximizes intertemporal learning about treatment response.</p></p></p>
Authors
Charles F. Manski
Working Paper details
- DOI
- 10.1920/wp.cem.2008.1008
- Publisher
- IFS
Suggested citation
Manski, C. (2008). Adaptive partial policy innovation: coping with ambiguity through diversification. London: IFS. Available at: https://ifs.org.uk/publications/adaptive-partial-policy-innovation-coping-ambiguity-through-diversification (accessed: 20 April 2024).
Related documents
More from IFS
Understand this issue
Gender norms, violence and adolescent girls’ trajectories: Evidence from India
24 October 2022
Raising revenue from closing inheritance tax loopholes
18 April 2024
Sure Start achieved its aims, then we threw it away
15 April 2024
Policy analysis
ABC of SV: Limited Information Likelihood Inference in Stochastic Volatility Jump-Diffusion Models
We develop novel methods for estimation and filtering of continuous-time models with stochastic volatility and jumps using so-called Approximate Bayesian Compu- tation which build likelihoods based on limited information.
12 August 2014
Assessing the economic benefits of education: reconciling microeconomic and macroeconomic approaches
This CAYT report discusses the strengths and limitations of several approaches to assessing the effect of education on productivity.
14 March 2013
Misreported schooling, multiple measures and returns to educational qualifications
We provide a number of contributions of policy, practical and methodological interest to the study of the returns to educational qualifications in the presence of misreporting.
1 February 2012
Academic research
Understanding Society: minimising selection biases in data collection using mobile apps
2 February 2024
Robust analysis of short panels
8 January 2024
A coefficient of variation for ordered categorical data: Analyzing relative health inequality and ageing in the UK and relative human resource inequality and gender in Canada
21 December 2023