Objective or Multi-Objective? Two Historically Competing Visions for Benefit-Cost Analysis

Land Economics, Forthcoming

35 Pages Posted: 24 Aug 2008

See all articles by H. Spencer Banzhaf

H. Spencer Banzhaf

Georgia State University - Department of Economics; PERC - Property and Environment Research Center; National Bureau of Economic Research (NBER)

Date Written: August, 22 2008

Abstract

As economists increasingly embraced benefit-cost analysis during the middle decades of the 20th century, they faced several challenges. One challenge was to reconcile the tension between two visions, long existing side-by-side in the profession, for the place of the economist in policy analysis. One vision limited the economist to providing positive analysis for use by authorized decision-makers; the other allowed normative judgments. This tension came to a crisis when, in the 1960s, the Water Resources Council introduced multi-objective benefit-cost analysis into water agencies' practices. The surrounding debate highlights the way philosophical differences can drive the technical details of policy analysis, the way political debates can overshadow academic ones, and the way even social scientists working together in a narrow subfield can profoundly misunderstand one another.

Keywords: History of economic thought, benefit cost analysis, water resources

JEL Classification: B2, B4, D6, H4, Q0.

Suggested Citation

Banzhaf, H. Spencer, Objective or Multi-Objective? Two Historically Competing Visions for Benefit-Cost Analysis (August, 22 2008). Land Economics, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1247782

H. Spencer Banzhaf (Contact Author)

Georgia State University - Department of Economics ( email )

P.O. Box 3992
Atlanta, GA 30302-3992
United States
404-413-0252 (Phone)

HOME PAGE: http://www2.gsu.edu/~prchsb/

PERC - Property and Environment Research Center

2048 Analysis Drive
Suite A
Bozeman, MT 59718
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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