Cost-Effective Incentive Allocation via Structured Counterfactual Inference

We address a practical problem ubiquitous in modern marketing campaigns, in which a central agent tries to learn a policy for allocating strategic financial incentives to customers and observes only bandit feedback. In contrast to traditional policy optimization frameworks, we take into account the additional reward structure and budget constraints common in this setting, and develop a new two-step method for solving this constrained counterfactual policy optimization problem. Our method first casts the reward estimation problem as a domain adaptation problem with supplementary structure, and then subsequently uses the estimators for optimizing the policy with constraints. We also establish theoretical error bounds for our estimation procedure and we empirically show that the approach leads to significant improvement on both synthetic and real datasets

Cheating on Their Taxes: When Are Tax Limitations Effective at Limiting State Taxes, Expenditures, and Budgets?

At a Seminar arranged by the Ecological Research Committee on October 30 , 1967, Dr. Svante Odén discussed the acidity and sulphur conditions over Europe and the consequensos to soils, surfaco waters and biological systems. In 1952 a European network of stations for atmospheric chemistry was organized by the International Meteorological Institute , Stockholm (Fig. 1). Odén and Dr. Torsten Ahl, Uppsala, later complemented the network in Scandinavia with stations for surface water chemistry (Fig. 3). At the atmospheric chemical network measurements of different element s havc been made for about 15 years. Changes of the atmospheric chemical climate can now be evaluated from the dat a, showing either positive or negative trends (Fig. 2 , 20 and 21). The sulphur content of air (Fig. 18) and of precipitation (Fig. 17 ) shows a characteristic pattern for Europe, indicating a close rolationship to air pollution from citiesand industrios. The rising sulphur content in the atmosphere are undoubtedly connected with the incrcasing use of sulphurous f'uels as a suostitute for coke and coal. The increasing addition of sulphur compounds t o the atmosphere (mainly as SO2 and H2S ) leads to an incrcase of the acidity o f the precipitation. Monthly data from threc stations conccrning pH are given (Fig. 4 , 5 and 6) . With a few exceptions the pH valuos at the network stations are dccrcasing with time (Fig. 9, 10 and 11) . The ratc of decrcasc of the 1) Department of Pedology, Agricultural College of Sweden, Uppsala 2) Swedish Natural Science Research Council , Sveavägen 166, Stockholm 23 pH values shows a geographical distribution pattern (Fig. 12), which can be expected from the intensity of industrial activities. The acidity of the yearly precipitation in Europe is mapped for 1958 (Fig. 13) , 1962 (Fig. 14) and 1965 (Fig. 15). In 1958 values below pH 5 were to be found only in a limited area over The Netherlands. As is shown on the succceding maps, this area has since spread over Central Europe. The other acid zones are also procecding and in 1965 the isoline for pH 4.5 had reached the Southern part of Sweden. In 1967 the pH values for Central Sweden had decreased to approx. 4.3. A study of the wind trajectories (Fig. 8) shows, that this low pH value is partly a result of a transport of air pollutants from source to sink areas. "The Scandinavian Sulphur Depression" (Fig. 2 2) indicates that a complicated hydrometeorological mechanism is involved in the distributional pattern. In 1965 almost a thousand Scandinavian lake and river waters were chemically investigatcd by Ahl and Odén. For considerable areas the pH-values were found to be so low as to affect fish life. The mapping of pH (Fig. 2 5 ) corresponds with that for Magnesium (Fig. 26) indicating a depletion of eations of the soil complex .. This is also reflected by thc long term changes of the concentration af anions ( so4) and cations (Ca) in river systems (Fig. 27 a and b). Last summer a special study o f the acidity of 600 lakes in Western Scandinavia was made by Dr. E . Eriksson. The results showed that since 1959 the pH-values have boen reduced on an average by 0.4 units. The acid precipitation will sooner or later acidify the river systers. The change in pH will depend, among others, on the buffer capacity of the catchment area. However, negative trends have already appeared in both large river systems (Fig. 23) and small ones (Fig. 24). The acidification of natural waters can be a threat to aquatic life. Organisms cannot normally exist in water with pH-values below 4.0. Certain valuable fish, such as salmon, are threatened at pH 5.5 and the catch of salrnon in Mörrumsån is continuously decreasing (Fig. 28 ). Soils may also be affected if the supply of nautralizing alkalis are depleted or poor. An impoverished forest arowth rate could be the result (Fig. 30). The important point is, according to Odén, that the balance of nature is considerably disturbed by the present atmospheric pollution of sulphuric acid and other acidifying compounds such as nitric and hydrochloric acid. An atmospheric chemical atlas of Europe containing data on air as well as precipitation is being prepared on the basis of existing data. * * * In the discussion that followed Odéns paper f'urther evidence of extensive fish kill in acid waters was given. Two speakers emphasized the economic aspects of the heavy damage that is caused each year by acid corrosion of metals, now amounting to 2 % of our gross national product, and the economic as well as cultural valuecs that are lost by the deterioration of buildnings and stone ornaments

Decentralization effects in ecological fiscal transfers - the case of Portugal

Portugal has a unitary system in which the central government transfers funds to lower government levels for their public functions. In 2007, Portugal introduced Ecological Fiscal Transfers (EFT), where municipalities receive transfers for hosting Protected Areas (PA). We study whether introducing EFT in Portugal incentivized municipalities to designate PA and has led to a decentralization of conservation decisions. We employ a Bayesian structural time series approach to estimate the effect of introducing EFT in comparison to a simulated counterfactual time series. Quantitative results show a significant increase in the ratio of municipal and national PA designations following Portugal’s EFT introduction. The analysis furthermore places emphasis on the importance of relevant municipal conservation competencies and the role of local decision makers’ motivations for PA designations. Results have important implications for conservation policy-making in terms of allocating budgets and competencies in multi-level governments

Does expenditure in public governance guarantee less corruption? Non-linearities and complementarities of the rule of law

Corruption is an endemic societal problem with profound implications in the development of nations. In combating this issue, cross-national evidence supporting the effectiveness of the rule of law seems at odds with poorly realized outcomes from reforms inspired in the academic literature. This paper provides an explanation for such contradiction. By building a computational approach, we develop three methodological novelties into the empirical study of corruption: (1) modeling government expenditure as a more adequate intervention variable than traditional indicators, (2) generating large within-country variation by means of bottom-up simulations (instead of cross-national data pooling), and (2) accounting for all possible interactions between covariates through a spillover network. Our estimates suggest that, the least developed a country is, the more difficult it is to find the right combination of policies that lead to reductions in corruption. We characterize this difficulty through a rugged landscape that governments navigate when changing the total budget size and the relative expenditure towards the rule of law. Importantly our method helps identifying the—country-specific—policy issues that complement the rule of law in the fight against corruption

Evaluating the impact of innovation incentives: evidence from an unexpected shortage of funds

To evaluate the effect of an R&D subsidy one needs to know what the subsidized firms would have done without the incentive. This paper studies an Italian programme of subsidies for the applied development of innovations, exploiting a discontinuity in programme financing due to an unexpected shortage of public money. To identify the effect of the programme, the study implements a regression discontinuity design and compares firms that applied for funding before and after the shortage occurred. The results indicate that the programme was not effective in stimulating innovative investment.R&D, public policy, evaluation

Trends in tropical forest loss and the social value of emission reductions

Reducing global forest losses is essential to mitigate climate change and its associated social costs. Multiple market and non-market factors can enhance or reduce forest loss. Here, to understand the role of non-market factors (for example, policies, climate anomalies or conflicts), we can compare observed trends to a reference (expected) scenario that excludes non-market factors. We define an expected scenario by simulating land-use decisions solely driven by market prices, productivities and presumably plausible decision-making. The land-use allocation model considers economic profits and uncertainties as incentives for forest conversion. We compare reference forest losses in Brazil, the Democratic Republic of Congo and Indonesia (2000–2019) with observed forest losses and assign differences from non-market factors. Our results suggest that non-market factors temporarily lead to lower-than-expected forest losses summing to 11.1 million hectares, but also to phases with higher-than-expected forest losses of 11.3 million hectares. Phases with lower-than-expected forest losses occurred earlier than those with higher-than-expected forest losses. The damages avoided by delaying emissions that would otherwise have occurred represent a social value of US$61.6 billion (as of the year 2000). This result shows the economic importance of forest conservation efforts in the tropics, even if reduced forest loss might be temporary and reverse over time

On the Feasibility of Extending Social Experiments to Wider Applications

Background: When deciding how to allocate limited funds for social programs, policymakers and program managers increasingly ask for evidence of effectiveness based on studies that rely on solid methodology, providing credible scientific evidence. The basic claim for the “social experiment”—that the “coin flip” of randomization creates two statistically equivalent groups that do not diverge except through an intervention’s effects—makes resulting estimates unbiased. Despite the transparency and conceptual strength of the experimental strategy for revealing the causal connection between an intervention and the outcomes of its participants, the wisdom or feasibility of conducting social experiments is often questioned on a variety of grounds. Purpose: This article defines 15 common concerns about the viability and policy reliability of social experiments, in order to assess how much these issues need constrain the use of the method in providing policy evidence. Setting: NA Intervention: NA Research Design: The research uses the authors’ experience designing and conducting dozens of social experiments to examine the basis for and soundness of each concern.  It  provides examples from the scholarly literature and evaluations in practice of both the problems posed and responses to each issue. Data Collection and Analysis: NA Findings: We conclude that none of the 15 concerns precludes substantially extending the use of randomized experiments as a means of evaluating the impacts of government and foundation social policies and programs