scholarly journals Benefit-Cost Analysis of Public Safety: Facing the Methodological Challenges

2017 ◽  
Vol 8 (3) ◽  
pp. 305-329 ◽  
Author(s):  
Maria Ponomarenko ◽  
Barry Friedman
Keyword(s):  
Cost Analysis ◽  
Research Agenda ◽  
Important Work ◽  
Benefit Cost Analysis ◽  
What Works ◽  
Methodological Challenges ◽  
The Social ◽  
The Many ◽  
Benefit Cost ◽  
Work Done

Although more than 100 billion dollars is spent each year on policing, we know very little about what works, and still less about whether the benefits of various policing policies and practices outweigh the costs. In particular, although there has been some important work done to assess the effects of various practices, and even to monetize some of the benefits of reducing crime, there has been virtually no attention paid to the other side of the benefit-cost equation: the social costs that particular policing practices potentially can impose. In February 2017, the Policing Project at NYU School of Law held a conference aimed at jumpstarting the use of benefit-cost analysis to assess policing practices, and to begin to tackle the many methodological challenges to doing so. Here, we provide an overview of the existing literature, identify the serious gaps that remain, and sketch out a research agenda for moving forward.

scholarly journals Appropriate Discounting for Benefit-Cost Analysis

2011 ◽  
Vol 2 (2) ◽  
pp. 1-20 ◽  
Author(s):  
David F. Burgess ◽  
Richard O. Zerbe
Keyword(s):  
Cost Analysis ◽  
Discount Rate ◽  
Cost Of Capital ◽  
Hyperbolic Discounting ◽  
Ease Of Use ◽  
Benefit Cost Analysis ◽  
The Social ◽  
Net Benefits ◽  
Benefit Cost

In order to be sensible about what discount rate to use one must be clear about its purpose. We suggest that its purpose is to help select those projects that will contribute more net benefits than some other discount rate. This approach, which is after all the foundation for benefit-cost analysis, helps to reconcile different suggested procedures for determining the discount rate. We suggest that the social opportunity cost of capital (SOC) is superior to other suggested approaches in its generality and its ease of use. We use the SOC to determine a range of real rates that vary between 6% and 8%. We suggest that approaches based on determination of preferences, which result in hyperbolic discounting, are less appropriate and less useful.

Benefit-Cost Analysis for Financial Regulation

2013 ◽  
Vol 103 (3) ◽  
pp. 393-397 ◽  
Author(s):  
Eric Posner ◽  
E. Glen Weyl
Keyword(s):  
Cost Analysis ◽  
Financial Markets ◽  
Financial Regulation ◽  
Allocative Efficiency ◽  
Social Value ◽  
Wall Street ◽  
Benefit Cost Analysis ◽  
The Social ◽  
Benefit Cost ◽  
Rule Making

Calls for benefit-cost analysis in rule-making, based on the Dodd-Frank Wall Street Reform Act, have revealed a paucity of work on allocative efficiency in financial markets. We propose three principles to help fill this gap. First, we highlight the need for quantifying the statistical cost of a crisis to trade off the risk of a crisis against loss of growth during good times. Second, we propose a framework quantifying the social value of price discovery, and highlighting which arbitrages are over- and under-supplied from a social perspective. Finally, we distinguish between insurance benefits and gambling-facilitation harms of market completion.

scholarly journals The Social Cost of Carbon, Greenhouse Gas Policies, and Politicized Benefit/Cost Analysis

2018 ◽  
Vol 6 (1) ◽  
pp. 59-76
Author(s):  
Benjamin Zycher
Keyword(s):  
Cost Analysis ◽  
Social Cost ◽  
Climate Impacts ◽  
Cost Calculation ◽  
Substantial Part ◽  
Social Cost Of Carbon ◽  
Benefit Cost Analysis ◽  
Climate Policies ◽  
The Social ◽  
Benefit Cost

Benefit/cost analysis can be a powerful tool for examination of proposed (or alternative) public policies, but, unsurprisingly, decisionmakers’ policy preferences can drive the analysis, rather than the reverse. That is the reality with respect to the Obama Administration computation of the social cost of carbon, a crucial parameter underlying the quantitative analysis of its proposed climate policies, now being reversed in substantial part by the Trump Administration. The Obama analysis of the social cost of carbon suffered from four central problems: the use of global benefits in the benefit/cost calculation, the failure to apply a 7% discount rate as required by Office of Management and Budget guidelines, the conflation of climate and GDP effects of climate policies, and the inclusion of non-climate effects of climate policies as co-benefits, as a tool with which to overcome the trivial temperature and other climate impacts of those policies. Moreover, the Obama analysis included in its “market failure” analysis the fuel price parameter that market forces are likely to incorporate fully. This Article suggests that policymakers and other interested parties would be wise to concentrate on the analytic minutia underlying policy proposals because policy analysis cannot be separated from politics.

Public Investment Criteria: Benefit-Cost Analysis for Planned Economic Growth by Stephen A. Marglin. London: George Allen & Unwin Ltd., 1967. pp.103. 22s. 6d.********** Investments for Capacity Expansion: Size, Location and Time-Phasing edited by Alan S. Manne. London: George Allen & Unwin Ltd., 1967. pp.239. 45s.Investments for Capacity Expansion: Size, Location and Time-Phasing edited by Alan S. Manne. London: George Allen & Unwin Ltd., 1967. pp.239. 45s.

1967 ◽  
Vol 7 (3) ◽  
pp. 416-420
Author(s):  
Arthur MacEwan
Keyword(s):  
Cost Benefit Analysis ◽  
Public Investment ◽  
Cost Benefit ◽  
Capacity Expansion ◽  
Point Of View ◽  
Systematic Analysis ◽  
Benefit Cost Analysis ◽  
The Government ◽  
The Many ◽  
Benefit Cost

These books are numbers 4 and 5, respectively, in the series "Studies in the Economic Development of India". The two books are interesting complements to one another, both being concerned with the analysis of projects within national plan formulation. However, they treat different sorts of problems and do so on very different levels. Marglin's Public Investment Criteria is a short treatise on the problems of cost-benefit analysis in an Indian type economy, i.e., a mixed economy in which the government accepts a large planning responsibility. The book, which is wholely theoretical, explains the many criteria needed for evaluation of projects. The work is aimed at beginning students and government officials with some training in economics. It is a clear and interesting "introduction to the special branch of economics that concerns itself with systematic analysis of investment alternatives from the point of view of a government".

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