Quotes from Jerry Z. Muller

In situations where there are no real feasible solutions to a problem, the gathering and publication of performance data serves as a form of virtue signaling. There is no real progress to show, but the effort demonstrated in gathering and publicizing the data satisfies a sense of moral earnestness. In lieu of real progress, the progress of measurement becomes a simulacrum of success.

There are things that can be measured. There are things that are worth measuring. But what can be measured is not always what is worth measuring; what gets measured may have no relationship to what we really want to know. The costs of measuring may be greater than the benefits. The things that get measured may draw effort away from the things we really care about. And measurement may provide us with distorted knowledge—knowledge that seems solid but is actually deceptive.

just as Soviet managers responded by producing shoddy goods that met the numerical targets set by their overlords, so do schools, police forces, and businesses find ways of fulfilling quotas with shoddy goods of their own:

Accountability ought to mean being held responsible for one's actions. But by a sort of linguistic sleight of hand, accountability has come to mean demonstrating success through standardized measurement, as if only that which can be counted really counts.

The most characteristic feature of metric fixation is the aspiration to replace judgment based on experience with standardized measurement.

Metric fixation leads to a diversion of resources away from frontline producers toward managers, administrators, and those who gather and manipulate data.

capitalism is too important and complex a subject to be left to economists. Achieving a critical comprehension of it requires perspectives beyond those characteristic of modern economics. That is why this is a history not of economic ideas, but of ideas beyond the capitalist economy.

It was in the eighteenth century that England became what (Adam) Smith called "a nation of shopkeepers".... (p. 58)

If what is actually measured is a reasonable proxy for what is intended to be measured, and if it is combined with judgment, then measurement can help practitioners to assess their own performance, both for individuals and for organizations. But problems arise when such measures become the criteria used to reward and punish—when metrics become the basis of pay-for-performance or ratings.

Metric fixation is the persistence of these beliefs despite their unintended negative consequences when they are put into practice.6 It occurs because not everything that is important is measureable, and much that is measurable is unimportant.

Trying to force people to conform their work to preestablished numerical goals tends to stifle innovation and creativity—valuable qualities in most settings. And it almost inevitably leads to a valuation of short-term goals over long-term purposes.

The emergence of this stable, public market for state debt was the most politically significant economic innovation of the age. It allowed the British government to borrow funds at a far lower rate than had been the case when it depended on moneylenders and tax farmers—the system that remained in force in France.

Often, indeed, individuals are most capable of deciding on the best provider of services. But not always, and in some domains choice is particularly fraught. In healthcare, for example, choices pertaining to physicians or hospitals are made either when patients are healthy and disinclined to bother with medical matters, or when they are sick and therefore more anxious about their decisions, which diminishes their ability to process complex and often conflicting metrics.

Thus, there is a gap between the measureable contribution and the actual, total contribution of the agent. As a result, measured performance (such as an increase in the division's profits or a rise in the company's stock price) may actually lead to the organization getting less of what it really needs from its employees. Moreover, there was an inevitable distortion of incentives created by the quest for simple, quantifiable standards by which to measure and reward performance

They have all distinguished between two forms of knowledge, one abstract and formulaic, the other more practical and tacit. Practical or tacit knowledge is the product of experience: it can be learned, but cannot be conveyed in general formulas. Abstract knowledge, by contrast, is a matter of technique, which, it is assumed, can be easily systematized, conveyed, and applied.

Rankings create incentives for universities to become more like what the rankings measure. What gets measured is what gets attention. That leads to homogenization as they abandon their distinctive missions and become more like their competitors.

The hazard of metrics so purely focused on monetary return on investment is that like so many metrics, they influence behavior. Already, universities at the very top of the rankings send a huge portion of their graduates into investment banking, consulting, and high-end law firms—all highly lucrative pursuits.48 These are honorable professions, but is it really in the best interests of the nation to encourage the best and the brightest to choose these careers?

Pronovost himself accounts for its success by the fact that the project worked through clinical communities, working toward common professional goals and treating central line–induced infections as a solvable social problem.

Nor, according to the Dutch experts, did the publication of metrics affect patient behavior in choosing a provider or hospital. Their conclusion: "The small body of evidence available provides no consistent evidence that the public release of performance data changes consumer behavior or improves care.

But his own interpretation is that the improvement in medical outcomes was brought about primarily by "a shift in clinicians' belief—by showing them that the rate of infection was not inevitable and could be controlled, in a way that appealed to their professional ethos as doctors and nurses.

The phenomenon of risk-aversion means that some patients whose lives might be saved by a risky operation are simply never operated upon. But there is also the reverse problem, that of overly aggressive care to meet metric targets. Patients whose operations are not successful may be kept alive for the requisite thirty days to improve their hospital's mortality data, a prolongation that is both costly and inhumane.

serious crimes such as robbery were downgraded to "theft snatch," and rapes were often underreported so as to hit performance targets. As a retired detective chief superintendent put it, "When targets are set by offices such as the Mayor's Office for Policing and Crime, what they think they are asking for are 20% fewer victims. That translates into 'record 20% fewer crimes' as far as … senior officers are concerned.

observations that are communicated through quantitative measures are regarded as "empirical," while observations conveyed in qualitative form are treated as less reliable, despite the fact that "in practice, many of the quantitative metrics used in assessments are themselves anecdotal in that they reflect the observational bias of those reporting.

The cases of Mylan and Wells Fargo are recent examples of an older and common pattern, by which policies of payment for measured performance lead employees to engage in actions that create long-run damage to a firm's reputation.