Despite its critics, cost-benefit analysis remains a fixture of the environmental regulation calculus. Most criticisms of cost-benefit analysis focus on the impossibility of monetizing environmental and health amenities protected by regulations. Less attention has been paid to the regressive wealth-transfer effects of regulations foregone based on cost-benefit analysis. This regressive effect occurs as long as downwind communities that suffer health and harms from environmental contamination are generally less wealthy than the owners of pollution sources that avoid regulatory-compliance costs. The availability of compensation to pollution-victims has the potential to ameliorate this regressive effect. This Article recommends that the availability of compensation to those suffering environmental harms should be an essential part of cost-benefit analysis, and the lack of compensation mechanisms should justify imposing regulatory burdens that might otherwise be rejected under cost-benefit analysis.
Karl S. Coplan, The Missing Element of Environmental Cost-Benefit Analysis: Compensation for the Loss of Regulatory Benefits, 30 Geo. Envtl. L. Rev. 281 (2018), http://digitalcommons.pace.edu/lawfaculty/1096/.