Is there a role for benefit-cost analysis in environmental, health, and safety regulation?

Arrow, Kenneth J.; Cropper, Maureen; Eads, George C.; Hahn, Robert W.; Lave, Lester B.; Noll, Roger G.; Portney, Paul R.; Russell, Milson; Schmalensee, Richard; Smith, V. Kerry; Stavins, Robert N.

doi:10.1017/s1355770x97220164

Cited by 89 publications

(93 citation statements)

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“…Risk mitigation decisions are currently evaluated using several tools, including but not limited to: benefit-cost analysis (BCA) (Arrow et al 1996), life-cycle cost analysis (LCA) (Chang and Shinozuka 1996), and probabilistic decision analysis (Keeney 1982). BCA involves maximizing the ratio of benefits expected from a decision to the expected costs incurred by taking a decision.…”

Section: Eio-lca Disaster Mitigation Frameworkmentioning

confidence: 99%

Probabilistic life cycle analysis model for evaluating electric power infrastructure risk mitigation investments

et al. 2010

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One effect of climate change may be increased hurricane frequency or intensity due to changes in atmospheric and geoclimatic factors. It has been hypothesized that wetland restoration and infrastructure hardening measures may improve infrastructure resilience to increased hurricane frequency and intensity. This paper describes a parametric decision model used to assess the tradeoffs between wetland restoration and infrastructure hardening for electric power networks. We employ a hybrid economic input-output life-cycle analysis (EIO-LCA) model to capture: construction costs and life-cycle emissions for transitioning from the current electric power network configuration to a hardened network configuration; construction costs and life-cycle emissions associated with wetland restoration; and the intrinsic value of wetland restoration. Uncertainty is accounted for probabilistically through a Monte Carlo hurricane simulation model and parametric sensitivity analysis for the number of hurricanes expected to impact the project area during the project cycle 32 Climatic Change (2011) 106:31-55 and the rate of wetland storm surge attenuation. Our analysis robustly indicates that wetland restoration and undergrounding of electric power network infrastructure is not preferred to the "do-nothing" option of keeping all power lines overhead without wetland protection. However, we suggest a few items for future investigation. For example, our results suggest that, for the small case study developed, synergistic benefits of simultaneously hardening infrastructure and restoring wetlands may be limited, although research using a larger test bed while integrating additional costs may find an enhanced value of wetland restoration for disaster loss mitigation.

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Section: Eio-lca Disaster Mitigation Frameworkmentioning

confidence: 99%

Probabilistic life cycle analysis model for evaluating electric power infrastructure risk mitigation investments

et al. 2010

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“…Such economic analyses move the decision out of the hands of experts and into the realm of public preferences, which has both advantages (in that it reflects the strength and direction of those preferences) and drawbacks (in that the public are by definition less well informed than experts). Partly for these reasons economists tend to see their analyses as an input to the decision making process (telling decision makers what individuals prefer) rather than the final decision itself (Arrow et al, 1996). 2 Other variants include asking respondents to state their willingness to accept (WTA) compensation either to suffer a specified loss in provision, or to forgo some prospective gain in provision.…”

Section: Aquatic Sciencesmentioning

confidence: 99%

Economic valuation of policies for managing acidity in remote mountain lakes: Examining validity through scope sensitivity testing

et al. 2005

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The paper introduces the reader to the contingent valuation method for monetary valuation of individuals' preferences regarding changes to environmental Aquat. Sci. 67 (2005) 274-291 Aquatic Sciences goods. Approaches to the validity testing of results from such studies are discussed. These focus upon whether findings conform with economic-theoretic expectations, in particular regarding whether valuations are sensitive to the size (or 'scope') of environmental change being considered, and whether they are invariant to alterations in study design which are irrelevant from the perspective of economic theory. We apply such tests to a large sample study of schemes to alter the acidity levels of remote mountain lakes. Results suggest that, when presented with environmental changes which respondents are concerned about, their values exhibit scope sensitivity and conform to theoretical expectations, and therefore could be used for formulating policy. However, when presented with changes which respondents feel are trivial, their values fail tests of theoretical consistency and are not scope sensitive, and therefore cannot be used within economic appraisals. Interestingly we find that qualitative focus group analyses are good indicators of whether a given change is likely to be considered trivial or not and therefore whether scope sensitivity tests are likely to be satisfied.

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“…The amount of money that a nation can devote to health protection and prevention is necessarily limited [90]. Choices must be made, and they should rely on the assessment of the cost and benefit of any action [90,91,92].…”

Section: Role Of Mass Media In Risk Perceptionmentioning

confidence: 99%

Radiation risks in perspective: radiation-induced cancer among cancer risks

Tubiana¹

2000

Radiat Environ Biophys

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The majority of the public in industrial countries believes that pollution and low doses of radiation are threats to good health. As a matter of fact, when these putative risks are compared to those originating from lifestyle, they appear very small. In particular, the risks associated with low doses of irradiation, even when they are assessed with the most pessimistic models, appear extremely small. Public anxiety is fuelled by the uncertainty regarding the magnitude of this risk and the use of the linear no threshold (LNT) hypothesis, which gives credence to the concept that even the smallest doses are harmful. There are a number of scientific and epidemiological data currently under debate that are not consistent with the LNT hypothesis. For example, no difference in the incidence of cancers or of birth defects has been observed between regions with low or high natural irradiation. This inconsistency between perceptions and data underlines the role of psychological factors studied since 1957 which should be placed in the perspective of the public's present attitude toward risk and technology. Social amplification or attenuation of risk may occur in several ways. Fearful concern about radiation began in 1955, with the beginning of the Cold War, when the possibility of a nuclear holocaust appeared very real. Analysis of the data shows that these fears of technology could have a detrimental effect; they should therefore be investigated and understood.

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Is there a role for benefit-cost analysis in environmental, health, and safety regulation?

Cited by 89 publications

References 0 publications

Probabilistic life cycle analysis model for evaluating electric power infrastructure risk mitigation investments

Probabilistic life cycle analysis model for evaluating electric power infrastructure risk mitigation investments

Economic valuation of policies for managing acidity in remote mountain lakes: Examining validity through scope sensitivity testing

Radiation risks in perspective: radiation-induced cancer among cancer risks

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