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Policy is a deliberate system of guidelines to guide decisions and achieve rational outcomes. A policy is a statement of intent and is implemented as a procedure or protocol. Policies are generally adopted by a governance body within an organization. Policies can assist in both subjective and objective decision making. Policies used in subjective decision-making usually assist senior management with decisions that must be based on the relative merits of a number of factors, and as a result, are often hard to test objectively, e.g. work–life balance policy. Moreover, Governments and other institutions have policies in the form of laws, regulations, procedures, administrative actions, incentives and voluntary practices. Frequently, resource allocations mirror policy decisions.


Policy is a blueprint of the organizational activities which are repetitive/routine in nature.

In contrast, policies to assist in objective decision-making are usually operational in nature and can be objectively tested, e.g. password policy. [1]

The term may apply to government, public sector organizations and groups, as well as individuals, Presidential executive orders, corporate privacy policies, and parliamentary rules of order are all examples of policy. Policy differs from rules or law. While the law can compel or prohibit behaviors (e.g. a law requiring the payment of taxes on income), policy merely guides actions toward those that are most likely to achieve the desired outcome. [2]

Policy or policy study may also refer to the process of making important organizational decisions, including the identification of different alternatives such as programs or spending priorities, and choosing among them on the basis of the impact they will have. Policies can be understood as political, managerial, financial, and administrative mechanisms arranged to reach explicit goals. In public corporate finance, a critical accounting policy is a policy for a firm/company or an industry that is considered to have a notably high subjective element, and that has a material impact on the financial statements.[ citation needed ]

It has been argued that policies ought to be evidence-based. An individual or organization is justified in claiming that a specific policy is evidence-based if, and only if, three conditions are met. First, the individual or organization possesses comparative evidence about the effects of the specific policy in comparison to the effects of at least one alternative policy. Second, the specific policy is supported by this evidence according to at least one of the individual’s or organization’s preferences in the given policy area. Third, the individual or organization can provide a sound account for this support by explaining the evidence and preferences that lay the foundation for the claim. [3]

Policies are dynamic; they are not just static lists of goals or laws. Policy blueprints have to be implemented, often with unexpected results. Social policies are what happens 'on the ground' when they are implemented, as well as what happens at the decision making or legislative stage. [4]

When the term policy is used, it may also refer to: [4]

The actions the organization actually takes may often vary significantly from stated policy. This difference is sometimes caused by political compromise over policy, while in other situations it is caused by lack of policy implementation and enforcement. Implementing policy may have unexpected results, stemming from a policy whose reach extends further than the problem it was originally crafted to address. Additionally, unpredictable results may arise from selective or idiosyncratic enforcement of policy. [4]


Intended effects and policy-design

The intended effects of a policy vary widely according to the organization and the context in which they are made. Broadly, policies are typically instituted to avoid some negative effect that has been noticed in the organization, or to seek some positive benefit.[ citation needed ]

A meta-analysis of policy studies concluded that international treaties that aim to foster global cooperation have mostly failed to produce their intended effects in addressing global challenges, and sometimes may have led to unintended harmful or net negative effects. The study suggests enforcement mechanisms are the "only modifiable treaty design choice" with the potential to improve the effectiveness. [5] [6]

Corporate purchasing policies provide an example of how organizations attempt to avoid negative effects. Many large companies have policies that all purchases above a certain value must be performed through a purchasing process. By requiring this standard purchasing process through policy, the organization can limit waste and standardize the way purchasing is done. [7]

The State of California provides an example of benefit-seeking policy. In recent years, the numbers of hybrid cars in California has increased dramatically, in part because of policy changes in Federal law that provided USD $1,500 in tax credits (since phased out) and enabled the use of high-occupancy vehicle lanes to drivers of hybrid vehicles. In this case, the organization (state and/or federal government) created an effect (increased ownership and use of hybrid vehicles) through policy (tax breaks, highway lanes). [8]


Policies frequently have side effects or unintended consequences. Because the environments that policies seek to influence or manipulate are typically complex adaptive systems (e.g. governments, societies, large companies), making a policy change can have counterintuitive results. For example, a government may make a policy decision to raise taxes, in hopes of increasing overall tax revenue. Depending on the size of the tax increase, this may have the overall effect of reducing tax revenue by causing capital flight or by creating a rate so high that citizens are deterred from earning the money that is taxed. [lower-alpha 1] [9]

The policy formulation process theoretically includes an attempt to assess as many areas of potential policy impact as possible, to lessen the chances that a given policy will have unexpected or unintended consequences. [10]


Example of the policy cycle concept. Policycycle.png
Example of the policy cycle concept.

In political science, the policy cycle is a tool used for analyzing the development of a policy. It can also be referred to as a "stages model" or "stages heuristic". It is thus a rule of thumb rather than the actual reality of how policy is created, but has been influential in how political scientists looked at policy in general. [11] It was developed as a theory from Harold Lasswell's work. It is called the policy cycle as the final stage (evaluation) often leads back to the first stage (problem definition), thus restarting the cycle.

Harold Lasswell's popular model of the policy cycle divided the process into seven distinct stages, asking questions of both how and why public policies should be made. [12] With the stages ranging from (1) intelligence, (2) promotion, (3) prescription, (4) invocation, (5) application, (6) termination and (7) appraisal, this process inherently attempts to combine policy implementation to formulated policy goals. [13]

One version by James E. Anderson, in his Public Policy-Making (1974) has the following stages:

  1. Agenda setting (Problem identification) – The recognition of certain subject as a problem demanding further government attention.
  2. Policy formulation – Involves exploring a variation of options or alternative courses of action available for addressing the problem. (appraisal, dialogue, formulation, and consolidation)
  3. Decision-making – Government decides on an ultimate course of action, whether to perpetuate the policy status quo or alter it. (Decision could be 'positive', 'negative', or 'no-action')
  4. Implementation – The ultimate decision made earlier will be put into practice.
  5. Evaluation – Assesses the effectiveness of a public policy in terms of its perceived intentions and results. Policy actors attempt to determine whether the course of action is a success or failure by examining its impact and outcomes.

Anderson's version of the stages model is the most common and widely recognized out of the models. However, it could also be seen as flawed. According to Paul A. Sabatier, the model has "outlived its usefulness" and should be replaced. [14] The model's issues have led to a paradoxical situation in which current research and updated versions of the model continue to rely on the framework created by Anderson. But the very concept of the stages model has been discredited, which attacks the cycle's status as a heuristic. [15]

Due to these problems, alternative and newer versions of the model have aimed to create a more comprehensive view of the policy cycle. An eight step policy cycle is developed in detail in The Australian Policy Handbook by Peter Bridgman and Glyn Davis: (now with Catherine Althaus in its 4th and 5th editions)

  1. Issue identification
  2. Policy analysis
  3. Consultation (which permeates the entire process)
  4. Policy instrument development
  5. Building coordination and coalitions
  6. Program Design: Decision making
  7. Policy Implementation
  8. Policy Evaluation

The Althaus, Bridgman & Davis model is heuristic and iterative. It is intentionally normative [ clarification needed ] and not meant to be diagnostic [ clarification needed ] or predictive. Policy cycles are typically characterized as adopting a classical approach, and tend to describe processes from the perspective of policy decision makers. Accordingly, some post-positivist academics challenge cyclical models as unresponsive and unrealistic, preferring systemic and more complex models. [16] They consider a broader range of actors involved in the policy space that includes civil society organizations, the media, intellectuals, think tanks or policy research institutes, corporations, lobbyists, etc.


Policies are typically promulgated through official written documents. Policy documents often come with the endorsement or signature of the executive powers within an organization to legitimize the policy and demonstrate that it is considered in force. Such documents often have standard formats that are particular to the organization issuing the policy. While such formats differ in form, policy documents usually contain certain standard components including:

Some policies may contain additional sections, including:


The American political scientist Theodore J. Lowi proposed four types of policy, namely distributive, redistributive, regulatory and constituent in his article "Four Systems of Policy, Politics and Choice" and in "American Business, Public Policy, Case Studies and Political Theory". Policy addresses the intent of the organization, whether government, business, professional, or voluntary. Policy is intended to affect the "real" world, by guiding the decisions that are made. Whether they are formally written or not, most organizations have identified policies. [4]

Policies may be classified in many different ways. The following is a sample of several different types of policies broken down by their effect on members of the organization. [4]


Distributive policies involve government allocation of resources, services, or benefits to specific groups or individuals in society. The primary characteristic of distributive policies is that they aim to provide goods or services to a targeted group without significantly reducing the availability or benefits for other groups. These policies are often designed to promote economic or social equity. Examples include subsidies for farmers, social welfare programs, and funding for public education.


Regulatory policies aim to control or regulate the behavior and practices of individuals, organizations, or industries. These policies are intended to address issues related to public safety, consumer protection, and environmental conservation. Regulatory policies involve government intervention in the form of laws, regulations, and oversight. Examples include environmental regulations, labor laws, and safety standards for food and drugs. Another example of a fairly successful public regulatory policy is that of a highway speed limit. [4]


Constituent policies are less concerned with the allocation of resources or regulation of behavior, and more focused on representing the preferences and values of the public. These policies involve addressing public concerns and issues that may not have direct economic or regulatory implications. They often reflect the broader values and beliefs of the society. Constituent policies can include symbolic gestures, such as resolutions recognizing historical events or designating official state symbols. Constituent policies also deal with fiscal policy in some circumstances. [4]


Redistributive policies involve the transfer of resources or benefits from one group to another, typically from the wealthy or privileged to the less advantaged. These policies seek to reduce economic or social inequality by taking from those with more and providing for those with less. Progressive taxation, welfare programs, and financial assistance to low-income households are examples of redistributive policies.

Notable schools

Balsillie School of International Affairs at the CIGI Campus Centre for International Governance Innovation 2.jpg
Balsillie School of International Affairs at the CIGI Campus
Blavatnik School of Government building Blavatnik School of Government, Oxford.JPG
Blavatnik School of Government building


Induction of policies

In contemporary systems of market-oriented economics and of homogeneous voting of delegates and decisions, policy mixes are usually introduced depending on factors that include popularity in the public (influenced via media and education as well as by cultural identity), contemporary economics (such as what is beneficial or a burden in the long- and near-term within it) and a general state of international competition (often the focus of geopolitics). Broadly, considerations include political competition with other parties and social stability as well as national interests within the framework of global dynamics. [17] [ additional citation(s) needed ]

Policies or policy-elements can be designed and proposed by a multitude of actors or collaborating actor-networks in various ways. [18] Alternative options as well as organisations and decision-makers that would be responsible for enacting these policies – or explaining their rejection – can be identified. "Policy sequencing" is a concept that integrates mixes of existing or hypothetical policies and arranges them in a sequential order. The use of such frameworks may make complex polycentric governance for the achievement of goals such as climate change mitigation and stoppage of deforestation more easily achievable or more effective, fair, efficient, legitimate and rapidly implemented. [19] [20] [21] [22] [ additional citation(s) needed ]

Contemporary ways of policy-making or decision-making may depend on exogenously-driven shocks that "undermine institutionally entrenched policy equilibria" and may not always be functional in terms of sufficiently preventing and solving problems, especially when unpopular policies, regulation of influential entities with vested interests, [22] international coordination and non-reactive strategic long-term thinking and management are needed. [23] In that sense, "reactive sequencing" refers to "the notion that early events in a sequence set in motion a chain of causally linked reactions and counter-reactions which trigger subsequent development". [24] This is a concept separate to policy sequencing in that the latter may require actions from a multitude of parties at different stages for progress of the sequence, rather than an initial "shock", force-exertion or catalysis of chains of events.

In the modern highly interconnected world, polycentric governance has become ever more important – such "requires a complex combination of multiple levels and diverse types of organizations drawn from the public, private, and voluntary sectors that have overlapping realms of responsibility and functional capacities". [25] Key components of policies include command-and-control measures, enabling measures, monitoring, incentives and disincentives. [19]

Science-based policy, related to the more narrow concept of evidence-based policy, may have also become more important. A review about worldwide pollution as a major cause of death – where it found little progress, suggests that successful control of conjoined threats such as pollution, climate change, and biodiversity loss requires a global, "formal science–policy interface", e.g. to "inform intervention, influence research, and guide funding". [26] Broadly, science–policy interfaces include both science in policy and science for policy. [27]

See also


  1. For more information on the effect of tax policy on state revenues, see Laffer curve.

Related Research Articles

Political science is the scientific study of politics. It is a social science dealing with systems of governance and power, and the analysis of political activities, political thought, political behavior, and associated constitutions and laws.

Public choice, or public choice theory, is "the use of economic tools to deal with traditional problems of political science". Its content includes the study of political behavior. In political science, it is the subset of positive political theory that studies self-interested agents and their interactions, which can be represented in a number of ways – using standard constrained utility maximization, game theory, or decision theory. It is the origin and intellectual foundation of contemporary work in political economy.

Public policy is an institutionalized proposal or a decided set of elements like laws, regulations, guidelines, and actions to solve or address relevant and real-world problems, guided by a conception and often implemented by programs. These policies govern and include various aspects of life such as education, health care, employment, finance, economics, transportation, and all over elements of society .Theimplementation of public policy is known as public administration. Public policy can be considered to be the sum of a government's direct and indirect activities and has been conceptualized in a variety of ways.

Accountability, in terms of ethics and governance, is equated with answerability, culpability, liability, and the expectation of account-giving.

Race to the bottom is a socio-economic phrase to describe either government deregulation of the business environment or reduction in corporate tax rates, in order to attract or retain economic activity in their jurisdictions. While this phenomenon can happen between countries as a result of globalization and free trade, it also can occur within individual countries between their sub-jurisdictions. It may occur when competition increases between geographic areas over a particular sector of trade and production. The effect and intent of these actions is to lower labor rates, cost of business, or other factors over which governments can exert control.

Public opinion, or popular opinion, is the collective opinion on a specific topic or voting intention relevant to society. It is the people's views on matters affecting them. The term originates from France, and first appeared in the 17th century, though writers had identified the importance of the opinion of the people long before this. Prior to the advent of mass media, public fora such as coffee houses and gentlemen's clubs were used as exchanges of opinion and some reputable locations had great influence.

<span class="mw-page-title-main">Public administration</span> Academic discipline; implementation or management of policy

Public administration or public policy and administration is the collective process through which public policy is created and implemented. It is also the sub-field of political science which studies this process. Civil servants preparing to take up administrative positions in the public sector may study public administration; public administration students also take up employment across the voluntary, nonprofit, and for-profit sectors in roles related to government relations, regulatory affairs,corporate social responsibility (CSR), environmental, social, and governance affairs (ESG), public procurement (PP), public-private partnerships (P3), and business-to-government marketing/sales (B2G).

<span class="mw-page-title-main">E-democracy</span> Use of information and communication technology in political and governance processes

E-democracy, also known as digital democracy or Internet democracy, uses information and communication technology (ICT) in political and governance processes. The term is credited to digital activist Steven Clit. By using 21st-century ICT, e-democracy seeks to enhance democracy, including aspects like civic technology and E-government. Proponents argue that by promoting transparency in decision-making processes, e-democracy can empower all citizens to observe and understand the proceedings. Also, if they possess overlooked data, perspectives, or opinions, they can contribute meaningfully. This contribution extends beyond mere informal disconnected debate; it facilitates citizen engagement in the proposal, development, and actual creation of a country's laws. In this way, e-democracy has the potential to incorporate crowdsourced analysis more directly into the policy-making process.

Policy analysis or public policy analysis is a technique used in the public administration sub-field of political science to enable civil servants, nonprofit organizations, and others to examine and evaluate the available options to implement the goals of laws and elected officials. People who regularly use policy analysis skills and techniques on the job, particularly those who use it as a major part of their job duties are generally known by the title policy analyst. The process is also used in the administration of large organizations with complex policies. It has been defined as the process of "determining which of various policies will achieve a given set of goals in light of the relations between the policies and the goals."

Governance is the process of making and enforcing decisions within an organization or society. It encompasses decision-making, rule-setting, and enforcement mechanisms to guide the functioning of an organization or society. Effective governance is essential for maintaining order, achieving objectives, and addressing the needs of the community or members within the organization. Furthermore, effective governance promotes transparency, fosters trust among stakeholders, and adapts to changing circumstances, ensuring the organization or society remains responsive and resilient in achieving its goals. It is the process of interactions through the laws, social norms, power or language as structured in communication of an organized society over a social system. It is done by the government of a state, by a market, or by a network. It is the process of choosing the right course among the actors involved in a collective problem that leads to the creation, reinforcement, or reproduction of acceptable conduct and social order". In lay terms, it could be described as the processes that exist in and between formal institutions.

New Public Management (NPM) is an approach to running public service organizations that is used in government and public service institutions and agencies, at both sub-national and national levels. The term was first introduced by academics in the UK and Australia to describe approaches that were developed during the 1980s as part of an effort to make the public service more "businesslike" and to improve its efficiency by using private sector management models.

<span class="mw-page-title-main">State-building</span> Term in social sciences and humanities

State-building as a specific term in social sciences and humanities, refers to political and historical processes of creation, institutional consolidation, stabilization and sustainable development of states, from the earliest emergence of statehood up to the modern times. Within historical and political sciences, there are several theoretical approaches to complex questions related to the role of various contributing factors in state-building processes.

<span class="mw-page-title-main">Theodore J. Lowi</span> Political scientist (1931-2017)

Theodore J. "Ted" Lowi was an American political scientist. He was the John L. Senior Professor of American Institutions teaching in the Government Department at Cornell University. His area of research was the American government and public policy. He was a member of the core faculty of the Cornell Institute for Public Affairs.

In politics, a political agenda is a list of subjects or problems (issues) to which government officials as well as individuals outside the government are paying serious attention to at any given time.

Multi-level governance is a term used to describe the way power is spread vertically between many levels of government and horizontally across multiple quasi-government and non-governmental organizations and actors. This situation develops because many countries have multiple levels of government including local, regional, state, national or federal, and many other organisations with interests in policy decisions and outcomes. International governance also operates based on multi-level governance principles. Multi-level governance can be distinguished from multi-level government which is when different levels of government share or transfer responsibility amongst each other. Whereas multi-level governance analyses the relationship of different state levels and interaction with different types of actors.'

Electronic participation (e-participation) refers to the use of ICT in facilitating citizen participation in government-related processes, encompassing areas such as administration, service delivery, decision-making, and policy-making. As such, e-participation shares close ties with e-government and e-governance participation. The term's emergence aligns with the digitization of citizen interests and interactions with political service providers, primarily due to the proliferation of e-government.

Public participation, also known as citizen participation or patient and public involvement, is the inclusion of the public in the activities of any organization or project. Public participation is similar to but more inclusive than stakeholder engagement.

Policy studies is a subdiscipline of political science that includes the analysis of the process of policymaking and the contents of policy. Policy analysis includes substantive area research, program evaluation and impact studies, and policy design. It "involves systematically studying the nature, causes, and effects of alternative public policies, with particular emphasis on determining the policies that will achieve given goals." It emerged in the United States in the 1960s and 1970s.

Ocean governance is the conduct of the policy, actions and affairs regarding the world's oceans. Within governance, it incorporates the influence of non-state actors, i.e. stakeholders, NGOs and so forth, therefore the state is not the only acting power in policy making. However, ocean governance is complex because much of the ocean is a commons that is not ‘owned’ by any single person or nation/state. There is a belief more strongly in the US than other countries that the “invisible hand” is the best method to determine ocean governance factors. These include factors such as what resources we consume, what price we should pay for them, and how we should use them. The underlying reasoning behind this is the market has to have the desire in order to promote environmental protection, however this is rarely the case. This term is referred to as a market failure. Market failures and government failures are the leading causes of ocean governance complications. As a result, humankind has tended to overexploit marine resources, by treating them as shared resources while not taking equal and collective responsibilities in caring for them.

Bureaucratic drift in American political science is a theory that seeks to explain the tendency for bureaucratic agencies to create policy that deviates from the original mandate. The difference between a bureaucracy's enactment of a law and the legislature's intent is called bureaucratic drift. Legislation is produced by elected officials, but is implemented by unelected bureaucrats, who sometimes act under their own preferences or interests. Bureaucratic drift is often treated as a principal–agent problem, with the House, Senate and Presidency acting as principals and bureaucracy acting as the agent. The government seeks to control bureaucratic drift in a number of ways, most notably congressional oversight and procedural controls.


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Further reading