Ten Facts Every Policy-maker Should Consider Before Giving Cost-benefit Analysis Veto Power
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Concerned that excessive regulation may be hampering economic growth and impeding job creation, some policymakers have proposed eliminating all regulations that fail a cost-benefit test. Cost-benefit analysis is a process that attempts to measure the dollar value of every cost and benefit that would result from a particular policy or proposal, and then compares the total costs and benefits. The proposal to use cost-benefit as a mandatory test that every regulation must pass to remain on the books, in effect, gives the analysis a veto power. This White Paper outlines ten important limitations of cost-benefit analysis that policymakers should understand before allowing its use to veto regulations. The White Paper was written by Mark Neuman-Lee (J.D. 16), with support from the University of Texas Regulatory Oversight Group (UTROG). UTROG is an unofficial organization at the University of Texas. It is comprised of law students who work with faculty to identify opportunities to enhance public participation in important federal and state regulatory programs. Its positions do not necessarily reflect the views of the administration of the KBH Center, the Law School, or the University of Texas.