A method of deriving values for entities not readily measured in other ways for the purposes of public decision making. It works by assuming that past decisions in the public sector have been consistent and that one may infer from the sums expended that the benefits thereby gained must have been valued at least as highly as this expenditure (or, if not expended, then the benefits cannot have been worth this much). For example, if a programme to introduce child-proof bottle caps for drugs at a cost of $50 per expected life saved was not adopted, then it is inferred that the average value of an expected life for children at risk was not greater than $50. Plainly the method also involves the absence of confounders that may have affected the past decisions but which may be irrelevant to the one under current consideration. The method's advantage seems to be mainly in exposing apparent inconsistencies in public decision-making. See Value of Life.
Was this article helpful?