Goodhart's Law is one of those neat formulations that codifies something I've been trying to put my finger on for years: "once a social or economic indicator or other surrogate measure is made a target for the purpose of conducting social or economic policy, then it will lose the information content that would qualify it to play such a role."
That is, once you start measuring GDP as a way of gauging social welfare, people will start to figure out ways to make GDP go up without improving social welfare (say, by swapping dirty financial derivatives). Once Google starts measuring inbound links as a way of evaluating the importance of web-pages, people will figure out how to increase the inbound links to unimportant pages (splogging, blogspam). And once you measure fat or calorie content as a proxy for the healthfulness of food, manufacturers will figure out how to decrease fat and calories without making the food more healthful (reducing fat by adding sugar, reducing calories by adding poisonous artificial sweeteners).
The law was first stated in a 1975 paper by Goodhart and gained popularity in the context of the attempt by the United Kingdom government of Margaret Thatcher to conduct monetary policy on the basis of targets for broad and narrow money, but the idea is considerably older. It is implicit in the economic idea of rational expectations. While it originated in the context of market responses the Law has profound implications for the selection of high-level targets in organisations.
On Friday, Disney announced that Disneyland Resort and Walt Disney World Resort will remain closed until further notice.
“They are putting us directly in harm’s way while profiting greatly. We cannot let this be considered normal.”
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There are few things more satisfying than the clickety-clack of an old keyboard. So old, in fact, that it’s really more of a typewriter sound and feel than that of a keyboard. But if you want to enjoy the benefits of both, check out this Rymek Retro Bluetooth 3.0 Mechanical Keyboard. Bringing you an impressive […]
There are plenty of productive ways to spend time while stuck indoors. While it’s undoubtedly fun to binge all 15 seasons of Supernatural or sink days of playtime into an Overwatch campaign, learning something new is definitely a more meaningful and long-term beneficial use of open hours. And if you’re going to invest time in […]
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