Does Increased Safety Have to Reduce Efficiency?
Edited by Carol Mansfield and V. K. Smith
Economic information derived from the analysis of proposed policies can have important effects on decision processes. This is especially true when agencies are making rules that restrict private behavior. In these situations, there are implications for both public and private resource allocations. The Office of Management and Budget and congressional committees exercise oversight on commitment of public resources. The implicit commitment of private resources to comply with new rules, however, lacked a specific mandate for scrutiny until Executive Order (EO) 12291 in 1981. After that, all United States (US) presidents have reauthorized comparable orders, extending the types of information assembled but retaining the basic requirement that, where feasible, there should be measures of the net economic benefits of the proposed policies. For example, EO 12866, Section 1(b) (6) states that to the extent permitted by law and where applicable, ‘[e]ach agency shall assess both the costs and the benefits of the intended regulation and, recognizing that some costs and benefits are difficult to quantify, propose or adopt a regulation only upon a reasoned determination that the benefits of the intended regulation justify its costs’.
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