You’re probably familiar with the phrase “Don’t judge a book by its cover.” I have an analogous saying, “Don’t judge a policy by its intent.”
Just as a good librarian knows a book’s flashy appearance or title can’t predict its contents, so too do good policymakers know that good intentions do not automatically create good policies.
A policy with a well-intentioned, morally just goal is only good and morally just if that goal is accomplished.
In the words of Milton Friedman, “One of the greatest mistakes is to judge policies and programs by their intentions rather than their results.”
Unfortunately, there are many examples of well-intentioned policies hurting the people they sought to help. Minimum wage laws, the war on drugs, ethanol fuel standards, and humanitarian aid—to name a few.
To understand how this dissonance between intentions and results occurs, let’s look at one of the most noble policy goals: reducing poverty. People living in extreme poverty face daily devastations, including malnourishment, lack of clean water, and limited access to healthcare.
Even as people with the means and ability have (rightly) tried to help, poverty reduction has remained elusive in many parts of the world.
One of the problems is that so-called “common sense” laws/actions in the West end up wreaking havoc on the cultures and economies of developing countries.
Consider child labor laws.
It seems like a “no-brainer” in the West to pass child labor prohibitions and protect children from harsh working conditions. People have the best intentions when they try to intervene – either through legislation, international aid, or boycotting certain products and industries – on behalf of poor children working in sweatshop conditions. However, these actions often serve to make matters worse.
When consumers in developed nations boycott companies, the result is reduced demand for these company’s products and fewer employment opportunities for the children. While some may see this as a success (arguing that children should not be working), many children in this situation work to provide basic necessities, such as food, for their families. Losing their employment can send children and the entire household into a deeper spiral of poverty.
The unintended consequences don’t stop at children either. When policies or popular boycotts eliminate or restrict the use of child labor, the cost of doing business rises, limiting the number of employment opportunities in developing countries. Production shifts toward developed economies where higher wages can be justified by the increased skill level of the labor force.
This is just one example of how laws and actions that look good on the surface can end up hurting the people they try to help.
It is a reminder that if we truly want to be a force for good, we must judge policies by their results – not their intentions.
Learn More
If you are interested in the intricacies of sweatshop policies, economist Benjamin Powell has an excellent book on the subject.
Students at NDSU interested in the topic of economic development can apply for the spring 2018 Mancur Olson Reading Group, which will focus on the effectiveness of foreign aid.
Meet the Author
Jeremy Jackson is the director of the Center for the Study of Public Choice and Private Enterprise (PCPE) and an associate professor in the NDSU Department of Agribusiness and Applied Economics. Read his bio.