Cost-Benefit Analysis and Public Sector Trust

Abstract

Eighty percent of Americans believe that government is run for “a few big interests” rather than the public interest. Rooted in notions of social welfare, cost-benefit analysis might be seen as an analytical procedure to flush out and discourage at least the most egregious abuses in lawmaking authority, thereby encouraging citizens to view their government as essentially pursuing some plausible notion of the public interest. Yet the extent to which cost-benefit analysis might fill this trust-building role is an unaddressed issue. Here, I conduct an experiment based on a (de)regulatory action in the environmental context to examine whether cost-benefit analysis might yield trust dividends. I find that cost-benefit analysis produces large increases in public sector trust, but only when paired with reasonableness review, and only among “elites.” This pattern of findings suggests that, without more, an agency declaration of cost justification is not credible, but that it may be made so through a form of reasonableness review. I discuss the contours of such review, and highlight perils if review is overly aggressive.

The Relationship between Efficiency and Quality of Municipally Owned Corporations: Evidence from Local Public Transport and Waste Management in Poland

“…Terminology discussions on how to define these types of goods in the context of public goods have already been the subject of theories in the early publications discussing public sector economics [27][28][29][30][31]. This issue is also present in many of the fundamental contemporary studies [1,[32][33][34]. Thus, without adopting strict definitions of the concept of public goods and services, it is accepted that the majority of public services are services which, according to accepted social standards, are insufficiently provided by the market.…”

Efektywność w ujęciu mikro- i makroekonomicznym w myśli ekonomicznej — przegląd teoretyczny

“…Joseph Eugene Stiglitz (ur. 1943) wymienia trzy typy efektywności niezbędne do prawidłowego funkcjonowania rynków w gospodarce: wymiany, produkcji oraz struktury produkcji 65 . Spełnienie łącznie wszystkich trzech warunków jest konieczne do wystąpienia efektywności w paretowskim rozumieniu.…”

External Costs of Agriculture Derived from Payments for Agri-Environment Measures: Framework and Application to Switzerland

“…External costs, or negative (technological) externalities are costs of unintended side effects of economic activities that do not show up in the prices paid by producers and consumers (e.g., [8,15]). Instead, these costs are incurred by third parties who are suffering from environmental and health impacts of emissions, for instance.…”