Data, evaluation and the quality of public policy

This new working paper describes an evaluation data set that researchers can use to study the effects of active labor market policies in Germany. The data set combines administrative data drawn from multiple sources with innovative survey data.

There is nothing like this available in the US or Canada. Under the guise of privacy concerns, the political process in the US and Canada avoids assembling the sorts of data that would allow very high quality non-experimental evaluations (as well as descriptive analysis useful for understanding program operation and informing program implementation and design) of active labor market programs. Part of this is, at least in the US, due to the fact that both political parties have strong, but different, prior beliefs, about the effectiveness of such programs. To many democrats they are obviously effective (how could more schooling be bad?) while for republicans they are obviously ineffective (how could bureaucrats increase anyone's employment chances?) thus the demand for quality empirical analysis is low regardless of who is in power.

What we might call the "data gap" (a play on the historical "missile gap") has the effect of leading US researchers, at the margin, to spend their time working on non-US data, as with Dale Mortensen's ongoing research project in Denmark and Sandy Black's ongoing use of the Norwegian register data. Now, to be sure, no one actually moves outside the US because the salaries are much too low, but they do change their travel plans and their research agendas. In some ways this is good, because it leads to more interactions between North American and European researchers. However, the US is a big country, and policy unguided by serious evaluation in the US affects a large number of people and one of the world's most important economies.

There are real, low-cost opportunities for dong some good here. Will anyone in DC pick up the ball and run with it?