Policy Research in an Imperfect World: Response to Terry F. Buss, “The Case Against Targeted Industry Strategies”

Abstract

It is a sign of the coming of age of economic development research that tough questions are being asked about the quality of the data, how solid the conclusions from research are, and when we are better off with limited data and knowledge than without them. Buss makes a valuable contribution in raising these issues. He goes too far in damning all studies because individual errors appear in some of them and is wrong in calling the studies atheoretical. His ideological bias causes him to attack any tinkering with the free market; on that basis, all economic development efforts are inappropriate. However, more external review of targeting studies and more evaluation of targeting programs would greatly improve the quality of data, studies, and economic development policy and practice.