Theories on Economic Policy Reforms, 25th Nov., 2010.

Not all economic policies are guided by ideology, either for or against free markets or state planning. Studies on organizational change show that “. . . change generally is motivated by events in an organization’s environment—some problem or surprise . . . reveal[s] weaknesses in established strategies and processes, and thus provoke adaptation and change.” (Staudenmayer 2002, pp. 584)  This can be said of both organizations and governments.

A system based on centralized authority “has usually been found to be negatively associated with innovativeness.”  This stems from the generalization that leaders at the top “are poorly positioned to indentify operational-level problems, or to suggest relevant innovations to meet these needs.” However, once a decision has been formulated, centralization “may encourage the implementation of innovations, once the innovation-decision is made.” (Rogers 1995, pp. 379-380)