Fields interested in studying public policy, such as political science and political sociology, have traditionally been concerned with studying policy ‘inputs’ or the dynamics of public policy formation. For example, in political science a key focus has been upon the role played by public opinion, political party activities, elections and similar phenomena in affecting policy-making processes and defining policy content, while, in the case of political sociology, a key focus has been on understanding the roles played by social structure in defining actor ‘interests’ and positions in policy-making processes (Mayntz 1983).
Studies in these disciplines revealed a great deal about policy formation but tended to neglect the implementation component of policy-making. Studies in other fields such as public administration and management and organization studies, on the other hand, following the admonitions of early students of the field such as the US president and political scientist Woodrow Wilson (1887) traditionally focused their efforts on the study of the inner workings of government – especially upon the study of behavioural and management issues involved in such tasks as financial administration and budgeting, ministerial responsibility and accountability, the operation of the merit principle and human resources/personnel administration – and purposely avoided considering the more political aspects of policy processes.
In his pathbreaking early works on public policy-making, Harold Lasswell drew on both these literatures not only to define public policy, clarify important aspects of policy-making such as the number and type of stages involved in policy deliberations, and emphasize the importance of context to its workings (Torgerson 1985 and 1990), but also to think about the main instruments of policy-making. Lasswell (1954) noted the extent to which governments could affect policy-making through manipulations involving, among other things, ‘symbols, signs and icons’, and argued that a principal task of the policy sciences must be to understand the nuances of these actions and their effects (Lasswell 1954; 1971).
Like others of Lasswell’s insights, this orientation was retained by many later students of policy-making who developed very flexible notions of the multiple means by which governments could affect, or give effect to, policy. In these early works, ‘policy instruments’ were defined very broadly so as to include a wide range of tools or techniques of governance used at different stages of the policy process. However, in the 1970s as the effort to improve policy-making through improved policy designs took shape, work turned to focus on the evaluation of the impact on policy outcomes of specific kinds of implementation related tools, primarily economic ones like subsidies and taxes (Mayntz 1983; Woodside 1986; Sterner 2002). This work eventually resulted in a specific approach to policy analysis which had as its central focus the evaluation of the characteristics, merits and demerits of particular policy instrument choices.
Bardach (1980) and Salamon (1981), for example, both argued in the early 1980s that policy studies had ‘gone wrong’ right at the start by defining policy in terms of ‘issues’, ‘areas’ or ‘fields’ rather than in terms of ‘instruments’. As Salamon put it:
The major shortcoming of current implementation research is that it focuses on the wrong unit of analysis, and the most important theoretical breakthrough would be to identify a more fruitful unit on which to focus analysis and research. In particular, rather than focusing on individual programs, as is now done, or even collections of programs grouped according to major ‘purpose,’ as is frequently proposed, the suggestion here is that we should concentrate instead on the generic tools of government action, on the ‘techniques’ of social intervention. (1981: 256)
Following these injunctions, other scholars began to investigate the links between implementation failures and policy success (Mayntz 1979; Goggin et al. 1990; O’Toole 2000) and turned their gaze directly on the subject of how implementation alternatives were crafted and formulated. Studies in economics and law which focused on the ‘ex-post’ evaluation of the impact of policy outputs (Bobrow 1977; Stokey and Zeckhauser 1978) began the more systematic appraisal of implementation alternatives and, ultimately, insights gleaned from a wide body of interdisciplinary literature concerning policy inputs and governmental processes were combined in the 1980s and 1990s in the explicit study of policy design. Many lessons about policy instruments and policy design were drawn from legal studies, for example, which revealed a great deal about how tools such as laws, regulations and other mechanisms involved in the delivery of various kinds of goods and services operate; and upon procedural aspects of formulation and implementation activities such as the passage of legislation and forms of administrative rule-making, while organization, management and administrative studies provided insights into the links between administrative systems and governance modes, among others (Peters and Pierre 1998; Pierre and Peters 2005).
Scholarly attention in the early 1980s was focused on the need to more precisely categorize types of policy instruments in order to better analyze the reasons for their use (Salamon 1981; Tupper and Doern 1981; Trebilcock and Hartle 1982; Bressers and Honigh 1986; Bressers and Klok 1988). Careful examination and systematic classification of implementation instruments and instrument choices, it was argued, would not only lead to insights into the factors driving the policy process and the characterization of long-term patterns of public policy-making, as Lasswell had hoped, but would also allow practitioners to more readily draw lessons from the experiences of others with the use of particular techniques in specific circumstances and hence improve policy designs and outcomes (Mayntz 1983; Linder and Peters 1984; Woodside 1986).
During this period studies in Europe and North America shed a great deal of light on the construction and establishment of regulatory and other political and administrative agencies and enterprises; traditional financial inducements, and the ‘command-and-control’ measures adopted by administrative agencies, during this period (Tupper and Doern 1981; Hood 1986; Howlett 1991; Vedung 1997; Landry et al. 1998). And this new emphasis upon the systematic study of policy instruments quickly generated a sizable academic literature and resulted in immediate application in the design of many new policy initiatives in emerging areas such as pollution prevention and professional regulation (Trebilcock 1983; Hippes 1988). Significant subjects such as the reasons behind shifts in patterns of instrument choices associated with the waves of privatization and deregulation which characterized the period also received attention (Howlett and Ramesh 1993).
Soon the field of instrument studies had advanced enough that Salamon (1989) could argue that the ‘tools approach’ had become a major approach to policy studies in its own right, bringing a unique perspective to the policy sciences with its focus on policy outputs.3 At this point he framed two important research questions to be addressed in future analyses of the tools of government action: ‘What consequences does the choice of tool of government action have for the effectiveness and operation of a government program?’ and ‘What factors influence the choice of program tools?’ (265). These questions were taken up by the ‘tools approach’ and the policy design literature in the 1990s.