From
eu2wiki
The domestic policies (DPs) are one of the best implementations of the game in the sense that you can change the character of your country and the events that will happen to you through your policies. They are of the outmost importance to achieve your goals in the game, since they affect research, economy, diplomacy, fighting, exploration, colonization, religious conversions and events. Define the type of country that you want to be before hand since you are only allowed one DP change every 10 years (40 changes in the game) so you won't be able to change them all up and down. Every DP change will cost you a -1 stability penalty and it will become painful when your stability costs are so high that it takes you over 10 years to raise it without extra expenditure on stability. Nevertheless most gamers will advise you to change the slider when the time comes every single time.
Every slider has 11 positions (value from 0 to 10) and for the purpose of the manual can be defined with the value of the policy at the right of the slider, so a Land value of 0 also means being fully naval oriented. The positions indicated for some events do not mean that you will not get them otherwise, some like explorer events or random conversions have more than one trigger, and the position indicates an increased chance from that point.
For further description, see
http://dhost.info/arsud/mediawiki-1.4rc1/index.php/Policy_sliders