Procrastination and Public Policy

amedinaceliAgnes Medinaceli Baldivieso*

Most people try to avoid procrastination. However, I’m pretty sure that everyone has fallen into this pit, at least once. Of course, putting off things has its benefits from time to time (1). Some even think that procrastination is the fuel of creativity (2). Apparently Steve Job’s success is attributed to his procrastination skills! (3). However, if creativity is not needed to fulfil a task, which is generally the case, then procrastination ends in regret and sometimes even in severe welfare losses (4). But, why do we procrastinate if we know that the costs in the long run are generally higher?

Nobel-economist, George Akerlof, wrote a paper in 1991 called “Procrastination and Obedience” (5) that shed light on the limits of rational thinking. In his work he tried to show that procrastination is more than just a bad habit and that it “occurs when present costs are unduly salient in comparison with future costs, leading individuals to postpone tasks until tomorrow without foreseeing that when tomorrow comes, the required action will be delayed yet again”. In other words, he suggested that people fail to maximise their long run utility due to a systematic distortion in their perceptions, where an action that is closer in time seems more important than it actually is. Ever since Akerlof published this paper, other economists, psychologists and philosophers have also studied this phenomenon at the individual level. I won’t cover all these studies, but they are definitely worth reading. (A good starting point might be the essays in “The Thief of Time: Philosophical Essays on Procrastination” (6)).

But, honestly, what I think is even more fascinating, and surprisingly has not received the right share of attention, is how and why groups of people tend to jointly procrastinate on important tasks that can lead to multiple and gigantic negative impacts on society as a whole. In other words, study procrastination within public policy. Let me explain why this deserves special attention by presenting just one example, which has already cost Bolivia hundreds of millions of dollars.

During the past few months at INESAD we have been working on a research project with Boston University called “Safeguarding Sustainable Development”. The objective of this project was to examine whether development bank’s safeguards are effective at minimising adverse social and environmental effects caused by infrastructure projects financed by them. The project covered four Latin American countries: Bolivia, Brazil, Ecuador, and Peru. For the Bolivian case, at INESAD we chose to study the performance of safeguards in three road projects.

I have to admit that when I started working on this project I never imagined that I was going to find out so many interesting, concerning, and puzzling aspects about road construction in Bolivia and public policy in general. (If you want to learn more about our findings and adventures, I invite you to read Lykke’s road blogs (7,8,9,10)).

If you don’t know anything about road works in Bolivia, like me before this project, you might assume that road construction/maintenance is quite simple. Surely you expect engineers in charge of the project to face obstacles from time to time, such as dealing with geologically unstable areas, but nothing they can’t solve with their knowledge and experience.  Well, let me update you, road works in Bolivia are paved with obstacles and problems you would have never imagined. Let me give you an example of one of these problems and explain you how procrastination is one of the main causes of this major problem.

A few weeks ago, while I was reading a contract between ABC (Administradora Boliviana de Carreteras, Bolivia’s national road agency) and a contractor, I found out, to my surprise, that one of the clauses states that the supply of aggregate material (mainly sand and small stones) is the responsibility of the contractor. This sounds sensible, right? Well, not in Bolivia, where one law (Reglamento a la Ley 3425 de Aprovechamiento y Explotación de Áridos y Agregados) states that municipalities can charge construction companies for the material they extract from their territories to build the road, and another law (Reglamento a la Ley 3507 de la Creación de la Administradora Boliviana de Carreteras) states that companies can extract materials at no cost for the construction of public roads. Because of this contradiction, negotiations about material extraction between communities and companies can take many months! This in turn has negative effects on the whole project and on the company’s budget (a single day with construction works cancelled due to material scarcity can cost a company hundreds of thousands of dollars). The worst is that this is a well known problem. For instance, President Morales, in the inauguration day of the La Paz-Oruro road, blamed municipal authorities, who resisted letting companies extract material, for the substantial delay of the whole project (11).

The question is: Why do companies sign these contracts with the Bolivian government if they know from the beginning that they are responsible for obtaining all the materials, that they will not receive any payment for this material, and that this issue is likely to cause major problems (in some cases even bankruptcy) for them? I asked this question to an engineer who has a lot of experience in road projects in Bolivia. He told me that although companies are aware of this problem, they choose to sign the contract anyway because they prefer to “postpone their deaths”, i.e. they procrastinate. But they are not the only ones procrastinating. Public institutions, such as ABC and ministries, who are also aware of this issue and who are able to implement policies or change the laws to avoid this don’t do anything about it, so they also procrastinate.

The most concerning aspect in this example is that not much is needed to avoid this problem. According to several actors involved in the road construction sector, this legal contradiction concerning the supply of aggregates is one of the main obstacles to the successful completion of road construction projects in Bolivia. A relatively small effort of fixing this legal problem, for example by simply specifying how much municipalities/communities/owners can charge per cubic meter of aggregates, could help avoid months and years of construction delays, cost increases, and bankruptcies. Since road construction is Bolivia’s biggest public investment category, improving the success rate of road construction projects could help the country save hundreds of millions of dollars within a few years.

This is just an example of procrastination within public policy. However, I’m sure that there are many others. The problem with procrastination within public policy is that it affects millions of innocent people. That’s why I think this phenomenon should be studied and treated separately from the study of procrastination at the individual level. The causes behind procrastination within public policy may be similar to the causes at the individual level, but the consequences are definitely not the same. A priori, I don’t think that procrastination within public policy has any benefits.

* The author is a Junior Researcher at INESAD, M.Sc. in Latin American Development, amedinaceli@inesad.edu.bo. The views expressed in this article are those of the author and do not necessarily reflect the views of Fundación INESAD.

Footnotes

(1) Benedictus, L. (2014) In praise of procrastination:  five reasons why it pays to wait. The Guardian. https://www.theguardian.com/tv-and-radio/shortcuts/2014/mar/03/procrastination-wait-work-jennifer-saunders-hypnotherapy

(2) Grant, A. (2016) Why I Taught Myself to Procrastinate. The New York Times. https://www.nytimes.com/2016/01/17/opinion/sunday/why-i-taught-myself-to-procrastinate.html

(3) Gillett, R. (2016) Steve Jobs was one of the greatest procrastinators ever: here’s how that helped him become so successful. Business Insider. http://www.businessinsider.com/how-procrastination-helped-steve-jobs-become-so-successful-2016-2

(4) O’Donoghue, T. and Rabin, M. (1998) Procrastination in Preparing for Retirement.

(5) Akerlof, G. (1991) Procrastination and Obedience. The American Economic Review, 81 (2), 1-19.

(6) Andreou, C. and White, M. (2010) The Thief of Time: Philosophical Essays on Procrastination.

(7) Andersen, L. (2017) Road blog No. 1: Murderous signs. http://inesad.edu.bo/developmentroast/2017/07/murderous-road-signs/

(8) Andersen, L. (2017) Road blog No. 2: Bad roads are debt traps as well as death traps. http://inesad.edu.bo/developmentroast/2017/07/road-blog-no-2-bad-roads-are-debt-traps-as-well-as-death-traps/

(9) Andersen, L. (2017) Road blog No. 3: On the opportunity costs of road closures and constrution delays. http://inesad.edu.bo/developmentroast/2017/07/road-blog-no-3-on-the-opportunity-costs-of-road-closures-and-construction-delays/

(10) Andersen, L. (2017) Road blog No. 4: Traffic accidents in Bolivia have tripled since 2000. http://inesad.edu.bo/developmentroast/2017/07/road-blog-no-4-traffic-accidents-in-bolivia-have-tripled-since-2000/

(11) Viceministerio del Estado Plurinacional de Bolivia (2015) El Presidente del Estado Inaugura la Doble Vía La Paz-Oruro. https://www.vicepresidencia.gob.bo/El-presidente-del-Estado-inaugura

 

Check Also

Advantages and disadvantages of being disabled in Bolivia

By: Lykke E. Andersen* Today is the International Day of Persons with Disabilities, and I …

Follow

Get every new post delivered to your Inbox

Join other followers: