is Benefit-Cost Analysis?
Benefit-cost analysis is a tool used to evaluate policy actions. Benefits are based on what individuals would be willing to pay for risk reductions or for other improvements from pollution reduction. Costs are determined by the value of the resources directed to pollution reduction. If estimated benefits are greater than estimated costs, then the policy “passes” a benefit-cost test. But the benefit-cost test alone is not the only relevant criterion for good public policy. As noted, most environmental laws do not create a cost-benefit test, and some do not even allow one to govern EPA policymaking. Back to top.
