White Paper: Retrospective Benefit-Cost Analysis
2015
In this article the authors consider how benefit-cost analysis can be used retrospectively to promote understanding of the impacts after a policy is implemented. Serving as a brief primer, the authors propose that analysis can be useful for identifying needed reforms as well as in improving the conduct of future prospective analyses. The major challenges relate to estimating what would have occurred in the absence of the policy and separating the effects of the policy from other factors.
The paper discusses the conduct of retrospective analysis, focusing on the differences between retrospective and prospective analysis, assuming readers are familiar with the basics of benefit-cost analysis. The authors describe possible analytic goals, then discuss how to address key issues. They provide a list of useful resources that provide additional information.
This article in one in a series sponsored by The Regulatory Reform for the 21st Century City project. This effort is funded by the Smith Richardson Foundation, and is exploring, identifying, and developing a best practice framework and accompanying resources for cities seeking to learn more about regulatory reform.
Readers may be interested in a related article in the series, Benefit-Cost Analysis and the Cities, which describes how cities can use benefit-cost analysis prospectively to help decision makers and concerned citizens anticipate and weigh the pros and cons of different policy choices.
White Paper: Retrospective Benefit-Cost Analysis
Source:
Baxter J, Robinson L, Hammitt J. White Paper: Retrospective Benefit-Cost Analysis. Regulatory Reform for the 21st Century City. Ash Center for Democratic Governance and Innovation, Harvard Kennedy School 2015. https://datasmart.hks.harvard.edu/news/article/white-paper-retrospective-benefit-cost-analysis-664