Policy decisions frequently call for a comprehensive accounting of positive and negative consequences. Benefit-cost analysis entails systematically identifying these consequences and characterizing them in comparable terms. Such analyses represent an intersection of IEc’s technical strengths, including: knowledge of regulated industries; risk analysis; resource economics; estimation and valuation of health effects; financial analysis; estimation of distributional effects; and data management and analysis.
IEc’s benefit-cost analyses adhere to several key principles:
- First, we strictly apply microeconomic concepts in our analyses, measuring changes in social welfare and distinguishing those changes from secondary or distributional impacts. Over the last three decades, IEc consultants have been instrumental in defining acceptable practices in the field of benefit-cost analysis, and we have contributed to guidance on conceptually sound approaches.
- Second, we structure our research and final products in accordance with agency guidance governing benefit-cost analysis. Adhering to such guidance ensures that the analysis will satisfy client needs and pass internal review.
- Finally, through research, outreach, and institutional knowledge, we ensure that all of our benefit-cost analyses are built around a realistic and nuanced set of compliance assumptions. In this way, our work stands up to scrutiny from affected actors and captures real-life consequences of policy changes.
Since our inception, IEc has helped clients evaluate the benefits and costs of environmental regulations and programs. We have led hundreds of studies, including some of the premiere benefit-cost analyses guiding formulation of national air emissions rules, water quality policy, and waste management policy. The client base for this work began with the U.S. EPA, but has evolved to include other federal agencies, state environmental authorities, international environmental agencies, and non-profit groups.
In support of U.S. Department of Homeland Security efforts to reduce safety and security risks, IEc provides wide-ranging benefit-cost services. We analyze the economic impacts of proposed regulations, estimating potential costs on industry, public agencies, and consumers. We also collaborate with agency and academic experts to evaluate potential benefits of regulatory alternatives, framing them in terms of the value of avoided consequences. Our work has included analyses of rules affecting immigration, cargo container security, trade processing systems, maritime safety and security, and other aspects of homeland security.
IEc provides cost-benefit analysis services to the Consumer Product Safety Commission and Health Canada’s Healthy Environments and Consumer Safety Branch. These analyses typically involve outreach to affected industries to assess compliance strategies; estimation of compliance and testing costs for segments of the affected industries; and characterization of the likely health benefits that would result from prospective regulations. Our work has supported regulations related to cigarette combustion safety; candle safety; cellulose insulation flammability; paint toxicity; and infant products, among others.
IEc applies rigorous benefit-cost methods to public health policy questions. We help clients assess regulatory measures that reduce human exposure to environmental pollutants, improve transportation safety, limit access to hazardous products, and influence consumer behavior. Our recent work has focused on topics such as regulation of tobacco and vaping products; medical licensing for mid-level health care providers; medical marijuana access; and management of linkages between chemical exposure and food allergies. Agencies that look to IEc for support on public health benefit-cost analysis include the U.S. Food and Drug Administration, U.S. EPA, Health Canada, and U.S. Department of Health and Human Services.
IEc is expert in the application of regional economic models that estimate how initial changes in one economic sector will flow through the economic system. IEc consultants are trained in application of major regional economic modeling software packages such as IMPLAN. In the context of benefit-cost analysis, we often use these models to assess the indirect impacts of regulatory compliance costs on regionally integrated businesses.