Valuing Foreign Lives and Settlements
Cost-benefit analysis in the United States for policy and legal purposes traditionally has been highly parochial, excluding not just losses or gains of welfare to non-U.S. residents from a given policy but also excluding any losses or gains in welfare U.S. residents would experience as a result of impacts to foreigners and foreign settlements. In the climate change context, this approach has meant that cost-benefit analyses for the costs of unmitigated climate change to the United States value at zero the losses that U.S. residents will bear as a result of the direct, adverse impacts of climate change to foreign lives and settlements. This article argues that there are sound theoretical reasons to include such welfare losses in a cost-benefit analysis, and that doing so requires going beyond revealed preference data to consider stated preference surveys. The article presents the findings of internet-based surveys that strongly suggest that the implicit assumption of the current approach to cost-benefit analysis in the United States—that U.S. residents value foreign lives and settlements that may be destroyed by climate change at zero—is untenable.
©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston
Articles in the same Issue
- Article
- Introduction to Inaugural Issue
- Benefit-Cost Analysis: Distributional Considerations under Producer Quota Buyouts
- A Synthesis of Random Assignment Benefit-Cost Studies of Welfare-to-Work Programs
- Valuing Foreign Lives and Settlements
- Designing Smarter Regulation with Improved Benefit-Cost Analysis
- Principles and Standards
- An Assessment of Important Issues Concerning the Application of Benefit-Cost Analysis to Social Policy
- Implementation: Skills and Perspectives
- Getting Real: Price Deflation of Nominal Values
Articles in the same Issue
- Article
- Introduction to Inaugural Issue
- Benefit-Cost Analysis: Distributional Considerations under Producer Quota Buyouts
- A Synthesis of Random Assignment Benefit-Cost Studies of Welfare-to-Work Programs
- Valuing Foreign Lives and Settlements
- Designing Smarter Regulation with Improved Benefit-Cost Analysis
- Principles and Standards
- An Assessment of Important Issues Concerning the Application of Benefit-Cost Analysis to Social Policy
- Implementation: Skills and Perspectives
- Getting Real: Price Deflation of Nominal Values
