Caveats on cost-benefit analysis

My recent post on science and race should have had some caveats on the utility of cost-benefit analysis (CBA).  I’ll be the first to admit that it can be abused and has its limits, especially with respect to environmental policy.   Although I haven’t actually read the book, Frank Ackerman and Lisa Heinzerling make that point in Priceless.

Nevertheless, I think that on some level we have to use CBA.  In the end it is a useful tool, and I mostly agree with Sunstein’s critique of Ackerman and Heinzerling.  Yes I know it’s unfair to read the criticism and not the original work.  Sue me.

So whatever caveats we attach to CBA, my larger thesis is unchanged: CBA plus values*, not science, should be used to analyze social policy like government funded pre-school.  And it goes without saying that when I say “my” thesis, I really mean Nobel-prize winning James Heckman’s thesis.  But I’ve already admitted that most of my work isn’t original.

*I think the “plus values” part is important because you can make all sorts of principled, theoretical arguments for or against these types of policies.  Go read some Nozik or Mansfield for the anti-view, and Rawls or Galston for the pro-view.

fyi, I list all these philosophers to impress my non-existent readers with my erudition.  I also like to believe my (imaginary) readers don’t even know what that word means and are looking it up right now.  For what it’s worth, I’ve actually read two of Galston’s books.  My fictitious readers are now even more impressed, and even more so by the creative ways I complain about my lack of readership. 13 page views over 10 days isn’t bad…right?