Measuring benefits

The RAND Corporation issued a report, by Lynn A. Karoly, on measuring the benefits in benefit-cost analysis (BCA) of social programs. It discusses the use of economic value ("shadow prices" or monetization) in evaluating such programs. Its key findings:
  • Many important benefits that accrue from effective social programs are rarely, if ever, monetized
  • Shadow prices for outcomes valued in BCAs of social programs do not consistently capture the full range of societal benefits or costs
  • Even when there is a well-established literature for valuing outcomes, the use of shadow prices is not consistent across studies of social programs
  • Program benefits that extend into the future may be monetized, but uncertainty associated with future projects needs to be recognized
The study's focus is on programs in the following categories: (1) early childhood intervention programs, (2) education (K-12) intervention programs, (3) youth development programs, and (4) employment and welfare programs.

Valuing Benefits in Benefit-Cost Studies of Social Programs, Nov. 7, 2008
      Report (pdf, 133pp/1.28MB)
      Summary (pdf, 9pp, 151kB)



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