An Efficiency Approach to the Evaluation of Policy Changes
AbstractThis paper describes an efficiency approach to the evaluation of policy changes. Rather than comparing the utility allocations that arise before and after a policy change is introduced, this approach evaluates a policy change by comparing it with other possible changes which might be made from the status quo. The main merit of the approach is that it is founded on the Pareto criterion rather than on a distributional value judgement. The paper provides a precise statement of the approach and applies it to a number of examples. Some objections to the approach are also anticipated and discussed.
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Date of creation: Aug 1999
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Other versions of this item:
- Coate, Stephen, 2000. "An Efficiency Approach to the Evaluation of Policy Changes," Economic Journal, Royal Economic Society, vol. 110(463), pages 437-55, April.
- D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
This paper has been announced in the following NEP Reports:
- NEP-ALL-1999-09-17 (All new papers)
- NEP-CDM-1999-09-17 (Collective Decision-Making)
- NEP-MIC-1999-09-17 (Microeconomics)
- NEP-PBE-1999-09-17 (Public Economics)
- NEP-POL-1999-09-17 (Positive Political Economics)
- NEP-PUB-1999-09-17 (Public Finance)
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