Document Type

Article

Publication Date

12-4-2007

Abstract

Cost-benefit analysis has not yet steamed through natural resources policy the way it has through the policy of pollution control. Given its popularity in the latter context, however, it is worthwhile to consider whether it would be a good idea to extend the use of cost-benefit analysis to natural resources law and policy. In this book chapter, I argue that this would not be a good idea. Using the polar bear as my example, I show that the conventional economic value of a species the public appears to regard as extremely valuable is probably quite low. Moreover, even if the value derived from economic analysis were high, economic analysis would miss many of the reasons why we might care about the polar bear and thus would provide a poor reflection of true value. Public goods, the future, natural interconnectedness, irreversible and discontinuous events, and the moral dimension are all poorly captured, if at all, by economic analysis. Yet these characteristics and consequences lie at the heart of the resource protection mission. Cost-benefit analysis captures the small things tolerably well but misses the large ones. The picture it gives of value is distorted, and we are better off – and have better information – without it.

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