34 Pages Posted: 5 Nov 2014 Last revised: 19 Dec 2014
Date Written: November 4, 2014
This Article evaluates judicial review of agency benefit-cost analysis ("BCA") by examining a substantial sample of thirty-eight judicial decisions on agency actions that implicate BCA. Essentially, the Administrative Procedure Act tasks federal courts with ensuring that federal agency action is reasonable. As more agencies use BCA to justify their rulemakings, the court's duty often requires judges to evaluate the reasonableness of agency BCAs. In this Article, we discuss the challenges that trigger judicial review of agency BCAs and the standards that govern the review. We then present specific examples of how courts analyze BCAs. Overall, we find many examples of courts promoting high-quality and transparent BCA. Courts have been willing to question BCA methodology and assumptions and request more transparency on these issues. As agencies rely more on BCA in their decision making, judicial review of BCA will be increasingly important. The stakes are high. Additional judicial oversight can be valuable — but bolstering any oversight effort to provide a policy check can also impose societal costs if desirable policies are delayed or left unimplemented. Ideally, efforts to foster greater judicial review should be structured so that the enhanced role of the judiciary itself passes a benefit-cost test. Armed with this Article's examination of the state of judicial review of BCA, scholars can more effectively evaluate the impact of judicial checkpoints on the use of BCA in agency decision making and assess whether shifting more regulatory oversight authority to the courts would be an effective approach to fostering more welfare-enhancing policies.
Keywords: benefit-cost analysis, judges, judicial review, administrative law, regulatory reform
JEL Classification: D61, H43, K23, K32, K41, Q50
Suggested Citation: Suggested Citation
Cecot, Caroline and Viscusi, W. Kip, Judicial Review of Agency Benefit-Cost Analysis (November 4, 2014). George Mason Law Review, 2015, Forthcoming; Vanderbilt Law and Economics Research Paper No. 14-31. Available at SSRN: https://ssrn.com/abstract=2519139