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Recent research on policy-making under uncertainty in the water sector has contributed to our understanding of types and sources of uncertainty as well as to the development of tools and approaches to manage uncertainty. This paper reviews the literature and identifies several strands of systematic bias, notably an emphasis on natural sources of uncertainty over human sources; a tendency to treat sources of uncertainty as independent and a corresponding neglect of interaction between sources; and a focus on tools to reduce or contain uncertainty rather than to accommodate it. The papers in this issue contribute to overcoming these biases.

Health insurance reform for rural China is at a crossroads. The achievements of recent reform initiatives appear remarkable as measured by coverage through the New Cooperative Medical Scheme (NCMS). Yet there is little evidence that NCMS has made major strides toward reducing the financial risks of health care for the rural population. We argue that to improve the overall performance of the NCMS, more attention should be directed to improve insurance benefit package, strengthen the roles of government agencies as purchasers and third-party payers, reforming provider payment methods, as well as to establish a fiscal redistribution mechanism to reduce inequities in health financing arising from different regions of the country. Our critical assessment also points to the danger that this system may be trapped in a vicious cycle of increases in government subsidies and resulting cost escalations in health care due to strategic responses among health care providers, a factor that hitherto has been largely overlooked.

China's New Co-operative Medical Scheme (NCMS), a government-subsidized health insurance programme, was launched in 2003 in response to deterioration in access to health services in rural areas. Initially designed to cover inpatient care, it has begun to expand its benefit package to cover outpatient care since 2007. The impacts of this initiative on outpatient care costs have raised growing concern, in particular regarding whether it has in fact reduced out-of-pocket (OOP) payments for services among rural participants. This study investigates the impacts on outpatient costs by analysing data from an individual-level longitudinal survey, the China Health and Nutrition Survey, for 2004 and 2009, years shortly before and after NCMS began coverage of outpatient services in 2007. Various health econometrics strategies were employed in the analysis of these data, including the Two-Part Model, the Heckman Selection Model and Propensity Score Matching with the Differences-in-Differences model, to estimate the effects of the 2007 NCMS initiative on per episode outpatient costs. We find that NCMS outpatient coverage starting in 2007 had little impact on reducing its participants' OOP payments for outpatient services. The new coverage may also have contributed to an observed increase in total per episode outpatient costs billed to the insured patients. This increase was more pronounced among village clinics and township health centres—the backbone of the health system for rural residents—than at county and municipal hospitals.

Proper roles for government and market in addressing policy problems may be assessed by considering the duality between market imperfections and government imperfections. The potential of government interventions or market mechanisms as core policy instruments can be eroded by fundamental deficiencies deeply rooted in either government or market as social institutions. The impacts of such deficiencies are much more extensive than postulated by the existing theories. Analysis here, based on policy innovations in land transport and health care in Singapore, suggests how policy mixes might become the norm of response for addressing policy problems found in a range of sectors. The analytical framework presented may help to distinguish among different policy mixes according to their effectiveness, but also provides some useful guiding principles for policy design. Adapted from the source document.

Despite the growing need for private sector participation (PSP) in the water sector, private sector investments in the water sector have experienced a downturn in recent years, especially concession projects, which accounted for nearly 80 percent of all PSP projects in urban water utilities from 1990 to 2005. This paper traces the concession to its origin—the French model—and focuses on the challenges of transferring the model into the context of developing countries, by comparing two cases of concession projects in Jakarta and Manila. This comparative analysis suggests that although the French model appears a compelling choice because of its promise of attracting capital investments and improving efficiency, successful applications of the model may require substantial modifications to its original form in order to adapt to prevailing legal and social norms as well as to local governance capacity.

While local government entrepreneurship has long been regarded as one of the main drivers of China's economic growth, it has increasingly been recognised as a potential source of a set of harmful policy consequences in recent years, such as rising government debt crises, pervasive corruption and environmental degradation. These criticisms have prompted questions about what types of entrepreneurship might be more desirable, and which incentive structures might be necessary to pave the way for the right kind of local government entrepreneurship. The articles in this special issue focus on new developments in local government entrepreneurship from a public policy perspective. Collectively, they explore the normative dimensions of local government entrepreneurship in China, with an emphasis on necessary policy changes to shape local government entrepreneurship in contributing to economic growth as well as other key policy objectives. (China/GIGA)

In water resources, there is a long tradition of utilization of methods to address hydrological and economic uncertainty. Less frequently considered, however, is how uncertainty rooted in political factors such as power asymmetry, the strength of institutions, and the interests of stakeholders, contributes to decision-making. This paper explores political uncertainty and its interaction with more routinely considered forms of uncertainty in international river basins. Using the example of the controversies surrounding major new infrastructure projects in the Eastern Nile Basin, we show that political uncertainty may play a key role in shaping the decisions of individual riparian countries about how to proceed with water resources development. Specifically, we consider whether uncertainty over the prospect of future cooperation might help explain why seemingly optimal economic outcomes that require cooperation (due to interconnectedness) remain elusive. We conclude with reflections on other dimensions of the water resources planning problem – climate change, changes in regional development matters, and preferences – that similarly require a framework that accounts for political uncertainty.

The persistence of policy failures is a recognized but not well-understood phenomenon in the literature of the policy sciences. Existing studies offer only limited insights into the persistence of policy failures as much of the literature on the subject to date has focused on conceptualizing the topic and differentiating between different types of failures. Much less attention has been paid to systematically examining the sources of the problems which lead to recurrent failures. Collectively, the articles in this issue move this discussion forward and show the persistence of policy failures can be better understood by examining a wide range of factors both within and beyond a policy subsystem, especially the nature of the political system and its influence on decision making, governance capacity and the impact of its limitations on the chances for policy success, and levels of uncertainty in policy knowledge and practice, which continue to plague decision making and decision makers.