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Rational Regulation: Oxymoron?

| Wednesday May 14th, 2008 | 0 Comments

Following up on the theme developed in their recently released book, “Retaking Rationality: How Cost-Benefit Analysis Can Better Protect the Environment and Our Health,” authors Richard L. Revesz – dean of New York University’s School of Law – and Michael A. Livermore will launch an Institute for the Study of Regulation at NYU’s law school this summer.
Cost-benefit analyses, the primary means used for decision support and decision making in government regulatory processes, have been overwhelmingly dominated by anti-regulatory rhetoric and vested interests for too long. Environmentalists, rather than fighting to restore balance and more rigorous rationality to the process left the field and concentrated their efforts on trying to persuade lawmakers to remove cost-benefit analysis from the procedural regulatory toolkit, according to Revesz.
That’s not going to happen, he contends. With a new administration coming into office next year, environmentalists need to embrace cost-benefit analysis and use it to better argue and support their positions.
Revesz describes the motivation and aim of the Institute in a May 8 guest essay on the Grist Mill.
“This time, instead of fighting — futilely — to end cost-benefit analysis, environmentalists should fight to mend it. For the past three years, my co-author Michael Livermore and I have studied how cost-benefit analysis has been used, and abused, in environmental law.
“These abuses are not inherent in cost-benefit analysis, but have arisen because the debate over how cost-benefit analysis has been dominated by industry trade associations and antiregulatory scholars. The only way to transform cost-benefit analysis into a more neutral tool is to take up the debate, to show where cost-benefit analysis has been twisted to justify and antiregulatory agenda.”


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