Question

Provide an argument against using cost-benefit analysis as the only way of making social decisions

Environmental and natural resource economics

Answer 1

Cost benefit analysis is seen as too imprecise to be used in important social . one argument against the cost benefit analysis as the only way of making social decisions can be stated as follows.

* Regulatory decisions ( concerning health, safety and environment) involve the delicate weighing of alternative outcomes and important social values by a regulator. Cost benefit analysis won't be precise if the prospective benefits from a regulation are not known with precision. Estimation of the benefits of a health safety and environmental regulation is a way difficult and complicated than the estimation of compliance costs. For example, science can't yet provide guidelines that allows us to determine, with a high degree of confidence, the safe level of exposure to a pollutant. monetizing health benefits may not be feasible or even desirable; . For example, a human life doesn't have a market value.

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