Proposals for improved evaluation of industrial policy efforts
Why does Swedish industrial policy need to be evaluated? In order to create a better understanding of how the efforts affect Swedish economy? In order to create better conditions for innovation and structural change? These are all important questions, but how should these efforts be evaluated? This is the tricky part. Uncertainty about the effects of industrial policy efforts extend far beyond Swedish borders. It is hard to measure the effects of these efforts, in part due to the fact that there are a lot of other factors that weigh in and in part because there is often a lack of data for conducting surveys.
Lately economic growth as a goal has been the subject of discussion, since growth has put pressure on the environment. The pursuit of growth has been replaced by the pursuit of sustainable growth. This also creates new challenges for how to evaluate how industrial policy contributes to economic change.
Regardless of the goal of industrial policy, evidence concerning the effects could be improved. This is where Sweden has an opportunity. With the help of data and a structured approach we have the chance of developing a better practice for learning and developing industrial policy efforts. This would mean that Sweden utilises its large efforts into research, innovation and enterprise in the best possible way. To achieve that, the Ministry of Enterprise and Innovation, governmental agencies for growth policy and other interested parties need to join forces in order to improve evaluation practices.
Improving the conditions for evaluation requires a few adjustments to current practice. First of all, an approach is needed for evaluating large complex programmes whose purpose is to affect large change processes of the economy or societal problems. A description of the policy effort and its anticipated effects (programme theory) should be created, regardless of the size and complexity of the programme. In the programme theory it is important to analyse the effect that an industrial policy effort could have on a complex reality, and put the effort into a context. This report, and in particular its appurtenant overview of current knowledge, will offer proposals of how one could proceed with this.
Secondly, there needs to be a structured dialogue between governmental agencies and government offices regarding industrial policy efforts that could lead to more realistic goals and clear descriptions of efforts. A dialogue of this nature would also entail that one determines at an early stage how the effort will be followed up on in the short and long term and what data will be collected.
Evaluation of industrial policy efforts is difficult and methods need to be developed and experiences gathered by all actors in the industrial policy area. Keeping in line with current practice, evaluation of efforts should be carried out by the executing governmental agencies as well as independent evaluation agencies. Independent evaluations carry a higher reliability towards a third party since the parties that are being evaluated are not contingent on them.
Finally, Growth Analysis proposes that an overview, an ongoing survey, of all industrial policy efforts in Sweden is produced. A survey of this nature might serve as a useful tool for, among other things, identifying overlapping of industrial policy efforts, as well as being able to explain how the different efforts relate to each other.