scholarly journals The role of value added in benefit/cost analysis

1991 ◽  
Vol 25 (2) ◽  
pp. 145-149 ◽  
Author(s):  
Stephen C. Cooke
Keyword(s):  
Cost Analysis ◽  
Value Added ◽  
Benefit Cost Analysis ◽  
Benefit Cost

Accounting for the Distribution of Benefits and Costs in Benefit–Cost Analysis

2020 ◽  
pp. 1-21
Author(s):  
James K. Hammitt
Keyword(s):  
Cost Analysis ◽  
Decision Makers ◽  
Policy Choice ◽  
Alternative Evaluation ◽  
Benefit Cost Analysis ◽  
Transfer Programs ◽  
Net Benefits ◽  
Benefit Cost ◽  
Benefits And Costs

Abstract Benefit–cost analysis (BCA) is often viewed as measuring the efficiency of a policy independent of the distribution of its consequences. The role of distributional effects on policy choice is disputed; either: (a) the policy that maximizes net benefits should be selected and distributional concerns should be addressed through other measures, such as tax and transfer programs or (b) BCA should be supplemented with distributional analysis and decision-makers should weigh efficiency and distribution in policy choice. The separation of efficiency and distribution is misleading. The measure of efficiency depends on the numéraire chosen for the analysis, whether monetary values or some other good (unless individuals have the same rates of substitution between them). The choice of numéraire is not neutral; it can affect the ranking of policies by calculated net benefits. Alternative evaluation methods, such as BCA using a different numéraire, weighted BCA, or a social welfare function (SWF), may better integrate concerns about distribution and efficiency. The most appropriate numéraire, distributional weights, or SWFs cannot be measured or statistically estimated; it is a normative choice.

Environmental Benefit-Cost Analysis and the National Accounts

2017 ◽  
Vol 9 (1) ◽  
pp. 27-66 ◽  
Author(s):  
Nicholas Z. Muller
Keyword(s):  
Cost Analysis ◽  
National Income ◽  
Value Added ◽  
Output Growth ◽  
National Accounts ◽  
Environmental Benefit ◽  
Benefit Cost Analysis ◽  
Benefit Cost ◽  
Pollution Emissions ◽  
Rates Of Growth

This paper demonstrates a new connection between benefit-cost analysis (BCA) and the national income and product accounts. The article computes an augmented measure of output, which is defined as gross domestic product (GDP) less environmental pollution damage. Environmental policy BCA is incorporated directly into the adjusted measure of output in two ways. In a particular time period, damages from pollution emissions are deducted from market GDP in a standard with-and-without policy comparison. Second, secular changes in damages, output (GDP), and correspondingly, in the adjusted measure of output are employed to estimate augmented rates of growth. Comparison to a no-policy counterfactual then yields the effect of the policy on the augmented measure of environmentally adjusted value added (EVA) growth. The empirical results suggest that, in the 30 states that adopted flue-gas desulfurization (FGD) technology between 2005 and 2011, augmented output grew 0.12% more quickly than in a no-scrub counterfactual. Augmented output growth in four states was at least 0.20% more rapid because of the installation of scrubbers. The paper reports that benefits-per-capita from FGD were mildly progressive and that counties with relatively large African American populations incur large benefits from FGD installation.

A Statistical Analysis of the Role of Benefit–Cost Analysis in Awarding TIGER Grants

2013 ◽  
Vol 19 (1) ◽  
pp. 37-50 ◽  
Author(s):  
Anthony C. Homan ◽  
Teresa M. Adams ◽  
Alex J. Marach
Keyword(s):  
Statistical Analysis ◽  
Cost Analysis ◽  
Benefit Cost Analysis ◽  
Benefit Cost

scholarly journals Economists and the 2002 Farm Bill: What Is the Value-Added of Policy Analysis?

2002 ◽  
Vol 31 (2) ◽  
pp. 139-146
Author(s):  
Bruce Gardner
Keyword(s):  
Political Process ◽  
Value Added ◽  
Decision Makers ◽  
Bayesian Decision ◽  
Farm Bill ◽  
Benefit Cost Analysis ◽  
Program Effects ◽  
Benefit Cost

The 2002 Farm Act is used as a case study of three problematic considerations related to economists' role in policy issues: priority on economic efficiency versus income distribution, the role of benefit-cost analysis, and appropriate policies given market power of agribusiness. The results of the 2002 Act relevant to each of these issues have been widely criticized, raising questions about the effectiveness of economists' involvement. However, given the uncertainties about many key program effects, criticisms of the Act are themselves in question. In this context, the role of economists is seen analytically as generating information for Bayesian decision makers, and practically as gaining attention for that information in the political process.

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