Ethics analysis versus cost-benefit analysis in environmental policy

Public Administration and Policy Analysis

The objective of this work is to compare and contrast the ethics analysis vs. The cost benefits analysis approaches to policy analysis.

There is a Greek Proverb, which states, "a society grows great when old men plants trees in whose shade they know they will never sit." (Clowney, 2006) Protection of the health of human beings and the natural environment at one time did not appear to make the requirement of such as economic analysis. It is stated in the work of Ackerman (2008) that it is "surprising that cost-benefit analysis is such a failure; at first glance it appears quite reasonable. If only one could assign monetary values to all the costs and all the benefits of a proposed policy, it would become a simple, transparent matter to add up the costs and benefits." (p.2) Many times it is impossible to define all the costs and benefits in monetary terms. Uncertain future results are estimated by analyst who state values based on their best possible guess. The analysts fail to calculate the worst-case scenario into the policy matter debate. Ackerman notes that the complexity and detailed process results in a loss of transparency as well as lost objectivity.

I. Priceless Price Fixing

Ackerman (2008) astutely notes the fact that attempting to price the priceless results in "partisan interests learn[ing] to cloak their agendas in the opaque technicalities of the evaluation." (p.4) One example of the shortcomings of a cost benefit in some policy areas include those in the area of health and environmental policies generally not expressed in comparable units. The process of attempting to compare the costs of end-of-pipe filters for reduction of industrial emissions is impossible to compare to the human lives saved or the protection of endangered species. Ackerman (2008) states that the assumption that anything can be exchange for anything else becomes misleading and disturbing when artificial prices are applied to the fundamentally nonmonetary values of life, health, and nature, as necessary in cost-benefit analysis." (p.5) In addition, the cost-benefit framework is such that "also implies that a cost, or a benefit, has the same impact on society regardless of who pays or receives." (p.5)

Summary and Conclusion

Cost benefit analysis appears to be an efficient method for comparing and analyzing policy related matters however, when attempting to assign values to priceless objects such as human lives, coral reefs, and the disappearing forests throughout the world, the realization that cost benefit analysis is inadequate is noted clearly in the literature reviewed in this study. Another problem with cost-benefit analysis are the competing partisan interests which have historically and traditionally manipulated the numbers to reflect their most desired position which is in reality a misrepresentation of the actual costs vs. benefits of policy related matter. A new method of calculation is critically needed in many areas of policy related analysis in order to truly reflect what is lost and what is gained in the area of public policy matters.