Posted by Eric Posner:
Against Feasibility Analysis
http://volokh.com/archives/archive_2009_08_16-2009_08_22.shtml#1250523930
A long time ago, I [1]wrote
about President Obama�s nomination of Cass Sunstein to head OIRA and
noted that some academics and commentators [2]opposed it because of
Sunstein�s support for cost-benefit analysis. Sunstein is not yet
confirmed many months later, not because of the opposition of critics
on the left, but because some [3]senators took fright at Sunstein's
views about protecting animals from cruelty. This is hardly germane to
the nomination to head OIRA, and one hopes that now that the political
point has been made, confirmation will come in due course.
Meanwhile, the academic debate about cost-benefit analysis continues.
Critics of cost-benefit analysis have argued that a better approach is
to use �feasibility analysis.� Feasibility analysis requires the
regulatory agency to identify hazards and regulate the activities that
cause them to the extent possible without causing widespread economic
disruption�which is cashed out in terms of revenue or profit loss for
the affected industry, bankruptcies, or plant closings. My colleague
Jonathan Masur and I have written a [4]new paper that argues that
feasibility analysis is a conceptually confused and economically
incoherent approach to regulation. It should appeal to neither pro-
nor anti-regulatory forces. The abstract is below.
Feasibility analysis, a method of evaluating government
regulations, has emerged as the major alternative to cost-benefit
analysis. Although regulatory agencies have used feasibility
analysis (in some contexts called 'technology-based' analysis)
longer than cost-benefit analysis, feasibility analysis has
received far less attention in the scholarly literature. In recent
years, however, critics of cost-benefit analysis have offered
feasibility analysis as a superior alternative. We advance the
debate by uncovering the analytic structure of feasibility analysis
and its normative premises, and then criticizing them. Our account
builds on two examples of feasibility analysis, one conducted by
OSHA and the other by EPA. We find that feasibility analysis leads
to both under- and over-regulation, and we conclude that it lacks a
normative justification and should have no place in government
regulation.
References
Visible links
1. file://localhost/var/www/powerblogs/volokh/posts/1250523930.html
2. http://www.progressivereform.org/articles/SunsteinOIRA901.pdf
3. http://www.ombwatch.org/node/10240
4. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1452984
Hidden links:
5. http://volokh.com/posts/1233083382.shtml
_______________________________________________
Volokh mailing list
[email protected]
http://lists.powerblogs.com/cgi-bin/mailman/listinfo/volokh
