institutional bias

Institutional Bias

Arnold Kling:

On the question of whether Federal workers are overpaid relative to private sector workers, [Justin Fox] writes,

The Federal Salary Council, a government advisory body composed of labor experts and government-employee representatives, regularly finds that federal employees make about a third less than people doing similar work in the private sector. The conservative American Enterprise Institute and Heritage Foundation, on the other hand, have estimated that federal employees make 14 percent and 22 percent more, respectively, than comparable private-sector workers….

… Could you have predicted ahead of time which organization’s “research” would find a result favorable to Federal workers and which organization would find unfavorable results? Of course you could. So how do you sustain the belief that normative economics and positive economics are distinct from one another, that economic research cleanly separates facts from values?

I saw institutional bias at work many times in my career as an analyst at a tax-funded think-tank. My first experience with it came in the first project to which I was assigned. The issue at hand was a hot one on those days: whether the defense budget should be altered to increase the size of the Air Force’s land-based tactical air (tacair)  forces while reducing the size of Navy’s carrier-based counterpart. The Air Force’s think-tank had issued a report favorable to land-based tacair (surprise!), so the Navy turned to its think-tank (where I worked). Our report favored carrier-based tacair (surprise!).

How could two supposedly objective institutions study the same issue and come to opposite conclusions? Analytical fraud abetted by overt bias? No, that would be too obvious to the “neutral” referees in the Office of the Secretary of Defense. (Why “neutral”? Read this.)

Subtle bias is easily introduced when the issue is complex, as the tacair issue was. Where would tacair forces be required? What payloads would fighters and bombers carry? How easy would it be to set up land bases? How vulnerable would they be to an enemy’s land and air forces? How vulnerable would carriers be to enemy submarines and long-range bombers? How close to shore could carriers approach? How much would new aircraft, bases, and carriers cost to buy and maintain? What kinds of logistical support would they need, and how much would it cost? And on and on.

Hundreds, if not thousands, of assumptions underlay the results of the studies. Analysts at the Air Force’s think-tank chose those assumptions that favored the Air Force; analysts at the Navy’s think-tank chose those assumptions that favored the Navy.

Why? Not because analysts’ jobs were at stake; they weren’t. Not because the Air Force and Navy directed the outcomes of the studies; they didn’t. They didn’t have to because “objective” analysts are human beings who want “their side” to win. When you work for an institution you tend to identify with it; its success becomes your success, and its failure becomes your failure.

The same was true of the “neutral” analysts in the Office of the Secretary of Defense. They knew which way Mr. McNamara leaned on any issue, and they found themselves drawn to the assumptions that would justify his biases.

And so it goes. Bias is a rampant and ineradicable aspect of human striving. It’s ever-present in the political arena The current state of affairs in Washington, D.C., is just the tip of the proverbial iceberg.

The prevalence and influence of bias in matters that affect hundreds of millions of Americans is yet another good reason to limit the power of government.