On Balance Blog

The opinions expressed in "On Balance" posts are those of the individual authors and do not represent the views of the Society for Benefit-Cost Analysis or other organization. The Society is open to proposals for posts on opposing views.

June 12, 2019

By: Rob Moore

Since Ronald Reagan’s 1981 Executive Order 12291 established benefit-cost analysis as standard practice for major rule changes, benefit-cost analysis has been commonly used to assess the efficiency of proposed federal regulations. Because of this and subsequent executive orders, all federal regulations that are projected to have a total economic impact of over $100 million are subject to a full benefit-cost analysis. Despite this prevalence at the federal level, benefit-cost analysis is much less common at the state level. In 2013, the Pew-MacArthur Results First Initiative released a study of the use of benefit-cost analysis in the states (study results were subsequently reported in the Journal of Benefit Cost Analysis in 2015). The study found that, over the four years from 2008 to 2011 states conducted only 36 full cost benefit analyses and 312 partial cost-benefit analyses. This averaged out to 9 full analyses and 78 partial analyses per year across all 50 states.

May 29, 2019

By: Bethany Davis Noll

Administrative agencies, courts, and litigants are just coming off two years of intense debates over the legality of agency deregulation through delay. One fascinating development has been how significant cost-benefit analysis has been in these debates. Cost-benefit analysis has formed the basis for several important court losses suffered by the administration. (See Air Alliance 2018; California 2017.) Now agencies have proposed to repeal many big-ticket rules, including the Clean Power Plan, the Clean Water Rule, and vehicle emissions standards. A key question is what role cost-benefit analysis will play in the upcoming legal battles over repeals.

Keith Belton,Manufacturing Policy Initiative in the School of Public and Environmental Affairs (SPEA), Indiana University John Graham, Indiana University School of Public and Environmental Affairs

May 15, 2019

By: Keith B. Belton and John D. Graham

In his campaign for the US presidency, candidate Donald Trump advocated widespread deregulation of the US economy. Upon taking office, President Trump quickly issued policies to fulfill his campaign promises. Midway through his term, it is fair to ask: Is deregulation being accomplished?

Clark Nardinelli, SBCA, On Balance, JBCAMay 15, 2019

By: Clark Nardinelli

The 2019 Annual Conference and Meeting of the Society for Benefit-Cost Analysis took place March 13-15 at George Washington University’s Marvin Center. The conference was attended by 329 friends of benefit-cost analysis, the largest number of attendees since the first conference in 2008. The attendees were treated to a cornucopia of benefits and costs, eminent speakers, and good conversation.

Society for Benefit-Cost Analysis

April 25, 2019

By: On Balance Editorial Staff

As the founding editor of On Balance, I wish we could review every new book of interest to our readership. We can, at least, point out some—of numerous—insightful books that are released. The editorial staff have identified these books that are a bit off the beaten track of Benefit-Cost Analysis, but yet might have some interesting lessons.

April 10, 2019

By: Jonathan Skinner

When researchers and policy analysts consider the benefits of expanding health insurance coverage, they understandably focus first on the health benefits, such as reduced infant mortality, increased longevity, lower rates of illness, and improved quality of life. However, access to insurance also lowers financial risk exposure—i.e., it protects the household against major shocks to its financial well-being—by mitigating lost earning capacity and helping to cover out-of-pocket health care expenditures. This post describes a new article published in the JBCA, Valuing Protection against Health-Related Financial Risks  with co-authors Kalipso Chalkidou and Dean Jamison, which is part of an open access Special Issue, Conducting Benefit-Cost Analysis in Low- and Middle-Income Countries, edited by Lisa Robinson

Anne BurtonMarch 6, 2019

By: Anne Burton

Since the 1964 Surgeon General’s report linking smoking cigarettes to adverse health outcomes, numerous federal, state, and local governments have passed regulations designed to reduce the prevalence of smoking and related externalities. Examples of such regulations include cigarette taxes, public health campaigns, minimum purchasing ages for tobacco, and – the focus of this post – smoking bans in bars and restaurants. While the links between smoking and health are clear, the effects of these bans on social welfare, which includes other types of risky behavior as well as smoking, are less well understood. This post describes work-in-progress to address some of the gaps. Preliminary results will be presented at the Annual Conference and Meeting of the Society for Benefit-Cost Analysis in March 2019.

 February 27, 2019

 By: Chiara Pancotti

 A retrospective exercise is an opportunity to learn and improve. With this in mind, an international consortium led by CSIL (Centre for Industrial Studies) recently developed an evaluation framework to carry out a retrospective assessment of infrastructure projects in several environmental sectors. The framework was developed as part of a study being carried out on behalf of the European Commission (Directorate-General for Regional and Urban Policy) to look retrospectively at 10 of the major infrastructural projects co-financed by the Commission over the period 2000 to 2013. While it will come as no surprise that, in retrospect, forecasts are imperfect, learning from mistakes or unexpected outcomes may improve the quality of forecasts. In turn, better forecasts may lead to better policy-making. This post reports some preliminary results from the study; more complete results will be presented at the Society for Benefit-Cost Analysis Conference in March 2019.

February 13, 2019

By: Jérôme Massiani

There is growing skepticism among both academics and government officials about the benefits of large-scale sport and cultural events. Although Input-Output (IO) has long been the dominant approach to estimating the impacts of these events, the method faces criticism for both its lack of realism and the incompleteness of its results. Consequently, economists have begun to turn to two alternative approaches: computable general equilibrium (CGE) and cost-benefit analysis. These approaches can take into account effects not captured within an IO framework. They also often produce strikingly different results than those obtained using an IO model. This post reports some preliminary results from ongoing research evaluating nearly 60 studies that use cost-benefit methods to evaluate events. More complete results will be presented at the Society for Benefit-Cost Analysis Conference in March 2019.

January 9, 2019

By: Lisa A. Robinson

Fomenting revolution brings to mind crowds storming the barricades, not analysts struggling to debug a spreadsheet or craft a clear sentence. Yet in his book, The Cost-Benefit Revolution, Cass Sunstein (Robert Walmsley University Professor, Harvard Law School) argues that benefit-cost analysts are doing exactly that. The barricades we surmount are decision-making errors resulting from overreliance on intuition and emotion, our weapons are science and economics, and our achievements are better policies.

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