Episode 1: What is Public Value?

George: Hi everyone, my name is George Veth; it’s great to have you all with us. Welcome to the inaugural episode of Public Value Conversations. In this series of podcasts, we will talk about the idea of Public Value, as well as expound on the frameworks behind what we call Public Value Thinking.

Today, and throughout this series, I have the distinct pleasure of working with my colleague and friend, Professor Mark Moore. He is the person who originated the idea of Public Value, and who has spurred on the field of academic thought and research behind its practice. Mark has written two seminal books on the topic: the first, Creating Public Value, and the second, Recognizing Public Value.

In this episode, I will ask Mark to take the time to elaborate on the general idea of Public Value. In future episodes, it will be more of a back-and-forth discussion. We’re also aided by my colleague and illustrator, Abigail Eckstrom, who will leverage her visual scribing to capture our thoughts while we chat. As you will see, her creative work begins around minute three of the discussion.

We’re always open to your thoughts, and you can reach me at george.veth@adaptablelabs.com if you’d like to continue the conversation. Thanks, and enjoy.

Mark, let’s jump right into Public Value and talk a little bit about what it is. Mark, I know that you’ve been working in the space of Public Value for quite a while, could you give us a little bit of your background in terms of thinking about and researching Public Value?

Mark: Sure, I was an undergraduate at Yale, and I took a special program there called Political Science and Economics. So it was a highly interdisciplinary applied program. And that prepared me both in economics and in political science and in philosophy. And I took those areas because I thought they would be important to a person who wanted to be in the game of creating Public Value or making public policy.

George: Excellent, and so how did that lead to this idea of public value and the term Public Value?

Mark: Well, it goes along with the fact that when I graduated from Yale, they had created a new program at Harvard University, it was called the Public Policy Program. And it was sitting in the Kennedy School of Government. And what they were offering at that time was a Master in Public Policy and a Ph.D. in Public Policy. And what they, as I say, offered was the chance to learn some analytic techniques that could improve the rationality, the logic, the evidence, behind important public policy decisions. And that seemed like a really good idea to me, and one where my training in politics, philosophy, and economics would be ideal. So I signed up eagerly and was in the very first class of that program.

George: Great, and so now, from there, over the decades, you’ve developed a concept of Public Value. Tell us, what is Public Value?

Mark: So, the idea of Public Value came to me as I was walking down the hall fairly early in my career at the Kennedy School. And we were trying to teach students about how to imagine what would be a valuable change in the world, and we were also trying to think about how to produce that through government. And we kept coming up against this question about, well, what words should we use to describe what it is that government did? And I suddenly thought, well, the private sector produces private value, maybe the government produces public value. And that was the beginning of it. And I thought to myself, now all I have to do is figure out what I mean by Public Value, and who gets to define it, and how do we measure it, and how do we produce it?

George: And so, if I ask you, “What is Public Value?” What would you say as a short elevator pitch on “What is Public Value?”

Mark: Okay, so the short answer to it is that it’s two words that are sort of a question masquerading as a statement, or an answer. And so, the idea that you needed to have some way to describe what the valuable results of governmental activity would be: We were living at that time, at a time when people were calling the government the “unproductive sector.” And I thought that was completely implausible, because I thought the government was producing all kinds of things that were valuable, incredibly invaluable to large numbers of people. And to have it be called the “unproductive sector” seemed to me to be a terrible mistake, and so the question then was, “How could we begin naming, observing, counting the various effects that government had that could be assigned a value that would compensate those of us who had to give up some of our money to taxation, and those of us who had to give up some of our liberty to regulatory authority of government?”

And so it was an effort to raise in people’s minds the idea that government could be value-creating, and it could be value-creating in this particular set of dimensions that could be called Public Value. And that meant that we had to have an idea about who could be the arbiter of the value that was being produced. And in the commercial sector, it was individuals, but in the public sector, when we were using the collectively-owned assets of government, it had to be some political and governmental process that decided what was valuable to produce, and then named it and began measuring it and observing it and determining whether we had in fact succeeded in creating net Public Value that meant the citizens got more out of our efforts than they had to pay in the form of taxation or restricted liberty.

It took me a while to figure out exactly how I wanted to organize it, and then to understand the significance of what it was that I’d done. So, having been trained at least in part in economics, I began with the economist’s view of value, and one of the important ideas in microeconomics is that individuals are the proper arbiters of value. And we have objective evidence of how individuals value things because they plunk their money down and take away a good or service as a consequence of that purchase. And so if the question is, “Did that individual value that?” The answer is, “Well, yes!” How do we know that? Well, they took money out of their pocket and paid for it. And so we begin with a sort of an idea that individual valuations of material conditions, and goods and services, particularly goods and services rather than conditions, is one dimension of Public Value, so you check that off. And you say, “Individuals like material goods and services.” They also like conditions, like being safe and secure, for which they pay for insurance, right, and a variety of other things that individuals might be interested in, not just goods and services, but being able to buy peace of mind, for example, or to live near a park, or a variety of other things like that. So it’s narrowly consumption, but it’s something that individuals value for themselves and their own material well-being.

Then staying with the idea that the important arbiter of value should be an individual, this was a sort of basic democratic idea: nobody could tell you what to value, you had to value it for yourself. I also, of course, knew from my philosophical training and from my political training that people were interested in the question of justice and fairness, as well as whether they could consume goods and enjoy material advantages. And, they were interested in justice and fairness for themselves. So there were these strongly-felt, individual ideas about wants, needs, and rights that were present in human beings from the very beginning. And the wants could be handled in the sort of economist’s frame, but the needs and rights might have to be handled in a frame that was more about, “So they had an idea that they needed it, and they had an idea that they had a right to it, but somebody else had to agree to that with them.” And it became then an idea of right relationships, or justice and fairness, rather than simply want, right?

This of course corresponded then, in philosophical terms, to the idea of utilitarianism, which is the basic philosophical idea that says aggregate social conditions should be evaluated in terms of producing the greatest good for the greatest number, where the good emphasizes material well-being, and it gets to net value by saying the more people that feel benefitted by it, relative to the cost of producing it, the better the aggregate result is, and therefore we should do those things that satisfy the most people at the least cost to others. We can come back to that in a minute.

But the other philosophical principle is a philosophical system that’s called deontology, and it’s concerned with questions about what’s right and proper and just and fair. And it refers more to a set of understandings about relationships among people and what one person owes to the other as a matter of justice and fairness, rather than simply as a matter of desire or need.

So, you start with one little cell if you will, in a two-by-two matrix, which says individuals want things, and to an extent the state supplies them. That represents value creation, much in the same way that the market creates value. And that also gives rise to the idea that, you know, citizens as “customers” of government, that we ought to be trying to provide benefits to particular individuals that they value in their terms. And that’s the utilitarian, the individual utilitarian idea. Then we go to the individual idea of justice and fairness, and there the person says, “Well, I have needs that the society – if it were a good society – would supply me with.” Or, “I have rights, which, if it were a good society, would be vindicated for me. And I’m having the experience that neither of those things is true, and therefore and improvement in my condition in the dimension of deontological ideas is that I feel like I’m being more justly and fairly treated, and that the needs that I might have from society as a whole might be given to me as a matter of not only public welfare but also as a matter of justice.”

So: individual interests in the good, individual interests in the just and the fair. But throughout this, notice that what’s kept looming up everywhere is this idea that there’s a collective out there, as well as an individual, and that the collective is making judgments about what’s good for it, all its members, if you will. And also what’s just and fair for all of its members.

So now you’ve got a two-by-two matrix in which you could think of there being effects that government produces that register at the individual level with respect to material satisfaction and gratification, and material well-being. There’s an experience that government can create, that creates a sense of fairness and justice at the individual level, where my rights are being vindicated, and my ideas about what I need are being adjudicated at the collective level to be something that we would all agree to and provide, sort of as a privilege, perhaps as a right as well.

And then suddenly you make this big leap, and you say, “Well, there’s this other thing though: how do we add up those individual experiences? And how do we decide whether the aggregate condition of the society we’re living in is good or just and fair?” And that brings you then this second tier of consideration, which is, “I’m now a person looking around me, and I know what my own experience is from the point of view of material welfare and what my experience is with respect to justice and fairness. But I’m looking around and witnessing the conditions of large numbers of other people, and I’m comparing that to my own idea of what a good and just society might be.” And that would be, perhaps if I have a broad enough imagination and degree of sympathy, would be one that treated all individuals well materially, that met their needs, that treated them fairly and justly, and I now as an individual think not only about myself living in these conditions, but I can see the conditions in which other people are living. And I can say, “I think I’m living in a society that is reliably good, it’s providing material things that the population as a whole needs.” Or, “I’m living in a society that’s just, where people are getting what they’re entitled to and what they deserve.”

And on that basis, then I can choose to participate in a collective process of deliberation that decides whether we should use the collectively-owned powers of the state – namely, tax dollars and regulatory authority – to produce something different than what we’re currently observing. And that gives us then these four different elements of Public Value.