We should observe, though, that from the point of view of social justice, the
efficiency criterion might be somewhat limited. First, because analysts typically
estimate people's "utility" by inferring their willingness to pay money for some
benefit (or to be spared some deprivation), people with less money do not, in
an analytical sense, have as much clout as thosewith more. ~ushto w big; limitation
this analytical anti-egalitarianism turns out to be will depend on particular cases,
however. ~ecobd,jfth e values at stake have few or no human defenders, and
therefore @ human pocketbooks to back an estimate of willingness to pay, the
efficiency criterion might underestimate thesevalues even if by some conception
of justice they ought to be weighted heavily. In theory, ecological values are the
main example, although in fact some ecological values do have human defenders
who derive enormous utility from preserving them, a utility that would be accounted
for in a proper efficiency analysis.
Although cost-effectiveness (CE) analysis and benefit-cost (BC) analysis sound
alike and are frequent traveling companions, they are not the same, and their
uses can be quite different. True, both conceptualize a domain of benefits accruing
to individual citizens valued in terms of their utility. And both construe the policy
problem as involving some production relationship between resources and welfareincreasing
outcomes. However, CE takes one or the other of these (either resources
or outcomes) as fixed or targeted; the analysis then tries to find the best means
to manipulate the other one (either maximizing the benefits given the level of
assumed resources or minimizing the number of resources given the targeted
outcome requirement). BC, on the other hand, allows both resources and outcomes
to be treated as variable in scale. It is therefore more complicated than CE, for
while both BC and CE concern themselves with the productive efficiency of the
program or project, BC is additionally concerned with the program's scale.
CE analysis is much more common than BC analysis. Indeed, a surprisingly
large number of policy issues can be simplified and stylized as CE problems, even
though on the surface they may not appear to be likely candidates at all for this
sort of treatment, for example