Benefit-Cost in a Benevolent Society

Ted Bergstrom ()

American Economic Review, 2006, vol. 96, issue 1, 339-351

Abstract: How should benefit-cost analysis account for the value that benevolent individuals place on others' enjoyment of public goods? When adding up the benefits to be compared with costs, should we sum the private valuations, the altruistic valuations, or something else? This paper argues that private valuations are appropriate if concern for the well-being of others respects their private preferences. The discussion has implications for family decision-making, welfare economics, and the design of applied contingent valuation studies.

Date: 2006
Note: DOI: 10.1257/000282806776157623
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