Using cost-benefit analysis to understand the value of social interventions

Abstract

Since 1983, the Washington State Institute for Public Policy has conducted applied research as a nonpartisan agency of the state legislature. Over the years, discussions in the state have turned toward emphasizing "evidence-based" programs and policies in decision making, and research requests of the legislature have evolved to reflect this movement. This article discusses the usefulness of the Institute's most recent approach to policy research, cost-benefit analysis. The authors discuss the two necessary conditions for driving policy change through cost-benefit analysis: institutional support and reliable analytical models. In addition, the authors provide nontechnical details of our three primary analytical steps: reviewing the research literature, computing the economics, and developing portfolios of policy options. © The Author(s) 2011.