scholarly journals Toward Standardization of Benefit-Cost Analysis of Early Childhood Interventions

2012 ◽  
Vol 3 (1) ◽  
pp. 1-45 ◽  
Author(s):  
Lynn A. Karoly
Keyword(s):  
Early Childhood ◽  
Economic Returns ◽  
Early Childhood Programs ◽  
Public And Private ◽  
Benefit Cost Analysis ◽  
Current State ◽  
Future Outcomes ◽  
Public And Private Sector ◽  
Benefit Cost ◽  
Early Childhood Interventions

A growing body of benefit-cost analyses (BCAs) of early childhood programs has been prompted by the increased demand for results-based accountability when allocating public and private sector resources. While the BCAs of early childhood programs serve to make such investments more compelling, there are limitations in the current state of the art, including a lack of standardization in the BCA methods used, from discount rates to shadow prices. The objective of this paper is to delineate a set of standards for conducting BCAs of early childhood programs. The paper reviews the existing evidence of the economic returns from early childhood programs that serve children and families in the first five years of life, discusses the challenges that arise in applying the BCA methodology such programs, highlights the variation in current methods used, and proposes a set of standards for applying the BCA methodology to early childhood programs. The recommendations concern issues such as the discount rate to use and the age to which costs and benefits should be discounted; stakeholder disaggregation; outcomes to value, the associated values, and projections of future outcomes; accounting for uncertainty; sensitivity analysis; and reporting of results. The proposed standards can guide the choices that analysts need to make about the methods to use when performing BCAs for one or more early childhood programs and they can support greater transparency in the results the analysts provide. The standards can also support consumers of the BCA results in their need to understand the methods employed and the comparability across different studies.

Benefit-Cost Analysis of Economic Resilience Actions

2017 ◽  
Author(s):  
Adam Rose
Keyword(s):  
Cost Analysis ◽  
Decision Makers ◽  
Economic Resilience ◽  
Public And Private ◽  
Benefit Cost Analysis ◽  
Comprehensive Benefit ◽  
Sector Decision ◽  
Public And Private Sector ◽  
Static Form ◽  
Benefit Cost

Economic resilience, in its static form, refers to utilizing remaining resources efficiently to maintain functionality of a household, business, industry, or entire economy after a disaster strikes, and, in its dynamic form, to effectively investing in repair and reconstruction to promote accelerated recovery. As such, economic resilience is oriented to implementing various post-disaster actions (tactics) to reduce business interruption (BI), in contrast to pre-disaster actions such as mitigation that are primarily oriented to preventing property damage. A number of static resilience tactics have been shown to be effective (e.g., conserving scarce inputs, finding substitutes from within and from outside the region, using inventories, and relocating activity to branch plants/offices or other sites). Efforts to measure the effectiveness of the various tactics are relatively new and aim to translate these estimates into dollar benefits, which can be juxtaposed to estimates of dollar costs of implementing the tactics. A comprehensive benefit-cost analysis can assist public- and private sector decision makers in determining the best set of resilience tactics to form an overall resilience strategy.

scholarly journals Benefit-Cost Analysis of a Package of Early Childhood Interventions to Improve Nutrition in Haiti

2019 ◽  
Vol 10 (S1) ◽  
pp. 154-184 ◽  
Author(s):  
Brad Wong ◽  
Mark Radin
Keyword(s):  
Early Childhood ◽  
Cost Analysis ◽  
National Income ◽  
Base Case ◽  
Cost Ratio ◽  
Case Scenario ◽  
Base Case Scenario ◽  
Benefit Cost Analysis ◽  
Benefit Cost ◽  
Early Childhood Interventions

We conduct a benefit-cost analysis of a package of early childhood interventions that can improve nutrition outcomes in Haiti. Using the Lives Saved Tool, we expect that this package can prevent approximately 55,000 cases of child stunting, 7,600 low-weight births and 28,000 cases of maternal anemia annually, if coverage reaches 90% of the target population. In addition, we expect these nutrition improvements will avoid 1,830 under-five deaths, 80 maternal deaths and 900,000 episodes of child illness every year. Those who avoid stunting will experience lifetime productivity benefits equivalent to five times gross national income per capita in present value terms, at a 5% discount rate. While previous benefit-cost analyses of this specific package have only estimated the lifetime productivity benefits of avoided stunting, this paper also accounts for reductions in fatal and non-fatal health risks. In the base case scenario, the annualized net benefits of the intervention equal Haitian gourdes 13.4 billion (USD 211 million) and the benefit-cost ratio (BCR) is 5.2. Despite these substantial benefits, the package may not be the most efficient use of a marginal dollar, with alternative interventions to improve human capital yielding BCRs approximately three to four times higher than the base estimate.

scholarly journals Using Benefit-Cost Analysis to Scale Up Early Childhood Programs through Pay-for-Success Financing

2015 ◽  
Vol 6 (3) ◽  
pp. 628-653 ◽  
Author(s):  
Judy A. Temple ◽  
Arthur J. Reynolds
Keyword(s):  
Early Childhood ◽  
Cost Analysis ◽  
Social Impact ◽  
Scale Up ◽  
Cost Savings ◽  
Early Childhood Programs ◽  
Benefit Cost Analysis ◽  
The Government ◽  
Private Investors ◽  
Benefit Cost

Increasing access to effective preschool programs is a high priority at local, state, and federal levels. Recently, two initiatives to expand preschool programming in Illinois and Utah have used funds from private investors to scale up existing programs. Private-sector social impact investors provide funding to nonprofit or public preschool providers to increase the number of children served. If the measured outcomes from preschool participation meet predetermined goals, then the estimated government cost savings arising from these preschool interventions are used to repay the investors. Social impact investing with a “Pay-for-Success” contract can help budget-constrained governments expand proven or promising preventive interventions without the need to increase taxes. Benefit-cost analysis (BCA) plays a crucial role in helping to identify which social, educational, or health interventions are suitable for this type of innovative financing. Benefit-cost analysts are needed to design the structure of the success payments that the government will make to the private investors. This paper describes social impact borrowing as a new method for financing public services, outlines the contribution of BCA, and discusses the innovative use of social impact financing to promote scaling evidence-based Child-Parent Centers and other early childhood programs.

A Unified Information Framework for Building A Common Vision in Sustainable City Development

2013 ◽  
Vol 2 (2) ◽  
pp. 45-63 ◽  
Author(s):  
Jialiang Yao ◽  
Terrence Fernando ◽  
Ian Everall
Keyword(s):  
City Development ◽  
Sustainable City ◽  
Public And Private ◽  
Current State ◽  
Education And Employment ◽  
To Come ◽  
Public And Private Sector ◽  
Sustainable Futures ◽  
Information Framework

Creating sustainable cities requires a stronger collaboration between a range of public and private sector organisations to ensure cities are safer, healthier, intelligent and prosperous places for citizens to experience an enhanced quality of life. Within this context, urban planning and regeneration projects play a major role where stakeholders need to come together to assess the current challenges or the opportunities within a city and implement projects that transform the physical, social and environmental dimensions to create prosperous and sustainable futures. Within these projects, stakeholders need to assess “social data intelligence” collected by individual agencies and also understand how proposed complex agendas such as transport, health, education and employment could lead to a better environment that can bring social, economical and environmental prosperity. This research proposes a novel Urban Information Framework that allows the stakeholders to integrate their datasets (both spatial and non-spatial) together to create a unified 3D virtual prototype of a city that can be used to represent both the current state of a city as well as intended futures. The proposed Urban Information Framework allows the stakeholders to combine different datasets together, whether they be social or physical transformation agendas, to understand the dependencies or to build up narratives that could be communicated visually to others. The overall framework has been developed and validated by working closely with two major regeneration projects in UK.

Grappling with Ignorance: Frameworks from Decision Theory, Lessons from Literature

2015 ◽  
Vol 6 (1) ◽  
pp. 33-65 ◽  
Author(s):  
Devjani Roy ◽  
Richard Zeckhauser
Keyword(s):  
Decision Making ◽  
Decision Analysis ◽  
Cognitive Biases ◽  
Life Experience ◽  
Descriptive Analysis ◽  
Sequential Decision ◽  
Benefit Cost Analysis ◽  
Market Values ◽  
Future Outcomes ◽  
Benefit Cost

Benefit-cost analysis (BCA), a discipline best known for guiding policy choices, can also guide personal decisions. In either application, traditional BCA tallies benefits and costs using market values or willingness to pay. When future outcomes are uncertain, as they are across a wide array of situations, BCA must call as well on the methods of decision analysis. Thus, von Neumann–Morgenstern utilities, subjective probabilities, and sequential decision strategies are brought into play.Traditional decision analysis distinguishes between risk and uncertainty. With risk, the probabilities of possible outcomes are known; with uncertainty, those outcomes are known, but not their probabilities. We introduce the concept of ignorance: a third, less tractable category. With ignorance, even the possible outcomes of decisions cannot be identified. Ignorance takes particular importance when high payoffs are associated with these unidentified outcomes, as is often the case. We identify such outcomes asconsequential amazing developments(CADs). In the policy realm, the 2008 financial meltdown or the Arab Spring would represent a CAD. For an individual, a CAD might be that one’s secure tenured position had been inexplicably terminated, or that one’s trusted business partner had long been shuttling corporate secrets to a competitor. We distinguish betweenunrecognizedandrecognizedignorance. In the latter category, we identify specific cognitive biases that impair decision making.Consequential ignorance cannot be studied in a controlled laboratory setting, since its payoffs are high, its time delays often long, and merely introducing the subject would tend to give away the game. Thus we develop a descriptive understanding of ignorance drawing on great works of literature, from antiquity to the present day, positing that skilled writers understand how humans make decisions and respond to unanticipated outcomes. Shakespearean examples would be Hamlet’s ignorance of his father’s killer, and Macbeth’s lack of awareness of the tragic ramifications following his actions to seize the Scottish crown.Following this descriptive analysis, we turn to prescription. We draw on decision analysis to develop a formula for calculating consequential ignorance; it incorporates the expected magnitudes and assessed base rates for CADs. Finally, we propose a decision-analytic framework for measured decision making, given ignorance. Our recommended approach explicitly recognizes decision-making costs, and thus proposes when to use quick and intuitive as opposed to more deliberative approaches to decision, or the labels Kahneman has popularized as System 1 and System 2.Studying ignorance through literature has important implications for BCA. Given the potential for ignorance, there are two key goals for prudent decision making. First, steps should be taken to recognize when ignorance might be present. Second, efforts should be made not to respond in a suboptimal fashion when ignorance is anticipated or when a CAD springs upon us. Great literature can provide the equivalent of widespread life experience, and can help a decision maker reach both goals. At its heart, this essay represents a benefit-cost approach to dealing with ignorance. Numerous connections to BCA are made throughout.

A Retrospective Benefit-Cost Analysis on the Elwha River Restoration Project

2019 ◽  
Vol 11 (1) ◽  
pp. 76-100
Author(s):  
Allen Bellas ◽  
Lea Kosnik
Keyword(s):  
Cost Analysis ◽  
River Restoration ◽  
River Ecosystem ◽  
Elwha River ◽  
Benefit Cost Analysis ◽  
Current State ◽  
Ex Post ◽  
Original Analysis ◽  
The Cost ◽  
Benefit Cost

AbstractIn 1992, Congress passed The Elwha River Ecosystem and Fisheries Restoration Act with the goal of “full restoration of The Elwha River Ecosystem and native anadromous fisheries.” As part of that act, the federal government was required to produce a benefit-cost analysis on dam removal of the Elwha and Glines Canyon dams, which was published in 1994. This article revisits that initial 1994 benefit-cost analysis; background on its methods and assumptions is given, comparisons are made to current state-of-the-art techniques in benefit-cost analysis, and an ex post benefit-cost analysis of the project is conducted for comparison purposes. We find that the cost and scope of the project exceeded original expectations, the cost of the foregone electricity generation was less than expected, and that anticipated recreational and fisheries benefits were both delayed, and lower, than expected. Furthermore, issues such as the value of hatchery-spawned versus wild anadromous fish seem not to have been anticipated in the original analysis, highlighting the fact that in doing an ex ante analysis, researchers must expect that unexpected factors may influence the ex post results of any project.

Decades of Evidence Demonstrate That Early Childhood Programs Can Benefit Children and Provide Economic Returns

2017 ◽  
Author(s):  
Jill Cannon ◽  
M. Kilburn ◽  
Lynn Karoly ◽  
Teryn Mattox ◽  
Ashley Muchow ◽  
...  
Keyword(s):  
Early Childhood ◽  
Economic Returns ◽  
Early Childhood Programs
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