Benefit-Cost AnalysisSlides [link]
Case study: Mercury Air Toxics Standard
- Read this Georgetown case study on the MATS BCA. You can skip the history and skim the details. Focus on what the major categories of benefits and costs are and how the EPA quantified them.
- Read “What Just Happened to the Mercury Rule?”, a blog post by Meredith Fowlie on a recent push by the Trump Administration to roll back this regulation.
- What are the direct costs and benefits of the MATS rule? (list them)
- What is the issue with “co-benefits” here? Do you think these should be included in the benefit cost analysis or no? (one paragraph)
- “Deep flaws in a mercury regulatory analysis”, Science 2020
- “E.P.A. Weakens Controls on Mercury” - New York Times
- RFF podcast with Mary Evans and Matt Kotchen, two of the Science article’s authors.
BCA Theory and Limitations
- KO pages 55-68
- “Pollution is segregated, too” – Washington Post
- What is the Kaldor-Hicks criterion for selection one policy over another? (1-2 sentences)
- How does the correlation between pollution and race in the United States alter your opinion of this criterion? Is this a good way to chose between policies in practice? (1 paragraph)
- For a great review of the academic work on environmental justice to date, see this JEP article by Spencer Banzhaf, Lala Ma, and Chris Timmins.
- Kaldor-Hicks vs Pareto
- Review evidence of correlation between pollution, race and poverty.
- Case study -- Mercury
- Common mistakes and misapplications of BCA