Three biases that impede local content development: Seeing through the illusions

Co-written with Dr. Raed Kombargi, Dr. Yahya Anouti, and Anthony Yammine

To boost growth, create jobs, and support national economic strategies, governments in developing countries are increasingly crafting policies to expand the share of local goods and services in large-scale infrastructure projects. But three biases – confirmation bias, in this instance a tendency towards false aggregation of demand; salience bias, or the fixation on the familiar; and optimism bias, which can lead to absolutist target-setting – can interfere with robust, fact-based analysis and policy design, producing myopic and counterproductive courses of action that can do more harm than good.