9.5
Goodhart's Law
The principle that an observed statistical regularity collapses once it is used as a target for control.
Goodhart (1975); the famous phrasing is Strathern (1997), citing Hoskin (1996)
What it does
Goodhart's actual wording: “Any observed statistical regularity will tend to collapse once pressure is placed upon it for control purposes.” The popular version is Strathern's, not his: when a measure becomes a target it ceases to be a good measure. Either way it is the standing warning over every other entry here.
When it breaks
It does not break. What breaks is the measurement system that forgot it.
Case
The origin case is UK monetary targeting in the 1970s and 80s: once the Bank of England set targets on specific money-supply aggregates, the historical relationship between those aggregates and inflation broke down and the targets were abandoned. Goodhart drew the law from watching it happen.
Goodhart (1975) · Problems of Monetary Management ↗In the wild
Unchecked · not part of the tier
What people have written about this tool in the last twelve months. A machine found these and nobody has read them. Everything above this line was checked by hand.
Loading…