Failures: Diffusion, Learning, and Policy Abandonment

Studies of the diffusion of policies and institutions tend to focus on innovations that successfully spread across governments. Implicit in such diffusion is the abandonment of the previous policy or institution. Yet, little is known about whether governments abandon policies that have failed elsewhere, as would be consistent with states acting as policy laboratories not only for policy successes but for failures as well. This paper focuses on the possible abandonment of failing welfare-to-work policies in the formative years (1997-2002) of the Temporary Assistance for Needy Families (TANF) program across the fifty U.S. states. Using a dyad-based event history analysis, I find that, if both states in a pairing have a policy and one state’s policy fails (in employing welfare recipients, reducing welfare rolls, or reducing overall poverty rates), then the other state is much more likely to abandon that failing policy. Moreover, such learning from the other state’s experience is more common when the states are ideologically similar to one another and when the legislature in the potentially learning state is more professional. * Prepared for presentation at the 2010 American Political Science Association Annual Meetings, Washington, D.C. Thanks to Jonathan Euchner, Fabrizio Gilardi, Kathleen Hale, Covadonga Meseguer, and seminar and conference participants at the Midwest Political Science Association conference, the ECPR workshops, Columbia University, Georgetown University, and University of Kentucky for helpful comments on earlier versions of this piece and its related work, and to Michael Cohen for valuable research assistance. Thanks to the Hoover Institution for their generous support during the formulation of this article. Please send questions and comments to: Craig Volden, Department of Political Science, 2140 Derby Hall, 154 North Oval Mall, Ohio State University, Columbus, OH, 43210-1373, or email ([email protected]). Failures: Diffusion, Learning, and Policy Abandonment Under what conditions do politicians abandon failing policies? Scholars have long been concerned that policymakers will refuse to admit their mistakes and reverse their ill-fated policies, lest voters see them as incompetent (e.g., Durr 2001, Fernandez and Rodrik 1991, Harrington 1993). Yet, federal systems may offer subnational governments a partial remedy to the problem of abandoning policy failures without prohibitively high political costs. In such systems, states and localities are often viewed as policy laboratories, in which policy experiments are tried and in which governments learn from one another’s successes and failures. If such laboratories work as promised, policymakers should be able to point to others’ failures as a justification for policy abandonment, even if their own policy has yet to fail or even if they do not wish to openly acknowledge their own failures. There is substantial evidence that the subnational governments in federal systems do act as policy laboratories. For example, recent scholarship uncovers the rapid spread of successful innovations through a process commonly referred to as policy diffusion (e.g, Volden 2006, Meseguer 2006a, Gilardi 2010). Yet, much less is known about the systematic abandonment of policies and whether the concepts of policy laboratories and policy diffusion are relevant to policy failures as well as successes. Indeed, whether based on learning or on other mechanisms (Shipan and Volden 2008), studies of policy diffusion may be biased in that they tend to focus on new policies that spread broadly across governments. Across such areas as lottery adoptions (Berry and Berry 1990), antismoking measures (Shipan and Volden 2006), or pension privatization (Brooks 2005), scholars have examined policies that have been adopted widely, rather than failed policy experiments. The reason is simple – when looking for evidence of