Bounded rationality or policy fumble? Parliament and executive in the preparation of public policy

Abstract

The theory of bounded rationality regards rational policy making as a process which fulfils certain requirements with regard to agenda setting, fact finding and analysis and decision making which fulfils minimum requirements. This perspective is here applied to the preparatory stage of public policy in four states, i.e. Iceland and the three Scandinavian states. An interesting pattern emerges. With regard to agenda setting Iceland deviates from the other countries in that coordination and the setting of priorities is less the responsibility of the cabinet and more that of individual ministers and parliament. The development and analysis of policy alternatives is also less systematic in Iceland as may be seen among other things in a smaller volume of research. The premises on which policy is based are therefore generally not as clear as in the other cases. At the decision stage departures from the conclusions reached during the preparatory phase are much more common in Iceland than in the other states. The main conclusion is that policy making in Iceland deviates more from the premises of the theory of bounded rationality than in Scandinavia.