Incorporating Animal Welfare into Cost–Benefit Analysis

Since non-human animals also experience welfare, an increasing number of scholars advocate including non-human animal welfare in cost–benefit analysis. Recent proposals to achieve this through interspecies comparisons of welfare, however, are incompatible with the principles of positive welfare economics. Based on conceptual and theoretical analysis, this article argues that, to remain consistent with positive welfare economics, the monetary value of welfare changes should be set equal to the marginal costs of alternative options available to offset those welfare changes. This applies equally to human adults, small children, and non-human animals. The article further argues that monetary valuation is appropriate only in cases involving marginal changes in the risk of harm—for example, an increased mortality risk for birds and bats caused by windmills—but not in cases involving direct and certain harms, such as those inflicted on farm animals. Moreover, a key rationale behind cost–benefit analysis is that a positive outcome increases social wealth, thereby expanding the government’s capacity to enhance social welfare through redistribution or investment in public services. In the interspecies context, however, this rationale remains doubtful as long as governments fail to give equal consideration to non-human animal welfare in policy making.