Putting Cost-Benefit Analysis in its Place: Rethinking Regulatory Review
Yale Law School
November 15, 2010
University of Miami Law Review, Winter 2011
Yale Law & Economics Research Paper No. 417
Policymakers need to reassess the role of cost-benefit analysis (CBA) in regulatory review. Although it remains a valuable tool, a number of pressing current problems do not fit well into the CBA paradigm. In particular, climate change, nuclear accident risks, and the preservation of biodiversity can have very long-run impacts that may produce catastrophic and irreversible effects. This article seeks to put cost-benefit analysis in its place by demonstrating both its strengths and its limitations. The Obama Administration should rethink the use of CBA as a way to evaluate regulatory policies and develop procedures to restrict its use to policy areas where its underlying assumptions fit the nature of the problem.
Number of Pages in PDF File: 32Accepted Paper Series
Date posted: November 16, 2010 ; Last revised: December 10, 2010
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