Society For Risk Analysis Annual Meeting 2013

Session Schedule & Abstracts

* Disclaimer: All presentations represent the views of the authors, and not the organizations that support their research. Please apply the standard disclaimer that any opinions, findings, and conclusions or recommendations in abstracts, posters, and presentations at the meeting are those of the authors and do not necessarily reflect the views of any other organization or agency. Meeting attendees and authors should be aware that this disclaimer is intended to apply to all abstracts contained in this document. Authors who wish to emphasize this disclaimer should do so in their presentation or poster. In an effort to make the abstracts as concise as possible and easy for meeting participants to read, the abstracts have been formatted such that they exclude references to papers, affiliations, and/or funding sources. Authors who wish to provide attendees with this information should do so in their presentation or poster.

Common abbreviations

Symposium: Who Benefits? Measuring the Distribution of Risk Policy Impacts

Room: Ruth   3:30 PM - 5:10 PM

Chair(s): Jonathan Levy

Sponsored by EBASG & Society for Benefit-Cost Analysis

M4-J.1  15:30  Barriers to assessing the distribution of regulatory impacts. Robinson LA*, Hammitt JK, Zeckhauser R, Linhart M; Harvard University

Abstract: Before they promulgate major environmental, health, and safety regulations, U.S. government agencies must assess each regulation’s aggregate economic impact and are also expected to assess how the impacts are distributed. We find, however, that agencies focus on estimating national benefits and costs and provide very little information on their distribution. To the extent that the distribution is mentioned, the discussion is often limited to noting that the examined regulation will not impose disproportionate adverse health effects on children, minorities, or low income groups. We explore several reasons for this approach. First, it may reflect philosophical framing: regulators may believe that they should choose the approach that maximizes net benefits as long as groups of concern are not harmed. Second, it may reflect political concerns: regulators may be worried that considering the distribution of costs and benefits will raise issues that they lack the legal authority to address. Third, it may reflect unstated and unexamined assumptions: regulators may believe that the distribution is insignificant or inconsequential. Fourth, it may reflect analytic challenges: regulators may need more technical guidance, data gaps may be substantial, and time and resource constraints may be severe. We conclude that each of these factors contributes to the lack of attention to the distribution of costs and benefits. However, to understand whether this inattention is problematic, we first need to better understand how costs and benefits are likely to be distributed and whether these impacts are significant. Decisionmakers can then determine whether more analysis is desirable.

M4-J.2  15:50  Ranking Distributions of Environmental Outcomes Across Population Groups. Sheriff G, Maguire K*; US Environmental Protection Agency

Abstract: This paper examines the use of inequality indices for evaluating distributional impacts of alternative environmental policies across population groups defined by demographic variables such as race, ethnicity, or income. The rich literature devoted to the use of inequality indices for analyzing income distributions within and across countries provides a natural methodological toolbox for examining the distributional effects of environmental outcomes. We show that the most commonly used inequality indices, such as the Atkinson index have theoretical properties that make them inconvenient for analyzing bads, like pollution, as opposed to goods like income. We develop a transformation of the Atkinson index that is suitable for analyzing bad outcomes. In addition, we show how the rarely used Kolm-Pollak index is particularly well-suited for ranking distributions of adverse health and environmental outcomes. We provide an illustration of its potential use in the context of emissions standards affecting indoor air quality.

M4-J.3  16:10  Characterizing the Distribution of Recent and Projected Air Pollution Risk Among Vulnerable and Susceptible Individuals. Fann NF, Fulcher CM, Baker KR, Roman HA*, Gentile MA; U.S. Environmental Protection Agency; Industrial Economics Incorporated

Abstract: Recent studies have characterized well the recent and projected total health burden of air pollution at the national scale. The literature has also explored the distribution of air pollution risks, and the level of risk inequality, among and between susceptible and vulnerable populations at the urban scale. This presentation will build upon this literature by demonstrating how source apportionment techniques can be used jointly with inequality coefficients to: attribute the nationwide level and distribution of total air pollution risks across vulnerable and susceptible populations in 2005 and 2016 to 7 emission sectors; and, characterize the change in the level of risk inequality among these populations over time. We define population vulnerability and susceptibility using characteristics identified elsewhere in the literature; these include baseline health status, socioeconomic status and other attributes that are empirically linked to air pollution-related risk. We calculate inequality coefficients including the Atkinson index. Our results suggest that reduced emissions among certain sectors between 2005 and 2016, including Electricity Generating Units and mobile sources, have significantly reduced the air pollution health burden among susceptible and vulnerable populations.

M4-J.4  16:30  Distributive Weights: A Defense. Adler MD*; Duke University

Abstract: This talk defends the use of distributive weights in cost-benefit analysis. A substantial body of scholarship in welfare economics explains how to specify weights, so as to mimic a utilitarian or equity-regarding social welfare function. The main literature on social welfare functions is vast -- encompassing optimal tax theory, public finance, theoretical social choice, and growth theory including climate change. But despite its firm intellectual foundations, distributive weighting is viewed skeptically by many engaged in cost-benefit analysis in the U.S. –- for various reasons, but perhaps mostly because of the received wisdom that ties cost-benefit analysis to Kaldor-Hicks efficiency. In this talk, I rehearse the strong case against the Kaldor-Hicks approach; review the theory of distributive weighting; provide a concrete formula for weights; and rebut a slate of objections to weighting, such as the fact that it involves value judgments (as if traditional cost-benefit doesn’t!), the supposed optimality of redistribution through the tax system, and others.

M4-J.5  16:50  Using inequality measures to incorporate environmental justice into regulatory analyses at the U.S. Environmental Protection Agency. Harper S, Ruder E*, Roman HA, Geggel A, Nweke O, Payne-Sturges D, Levy JI; Industrial Economics, Incorporated

Abstract: Environmental justice concerns are theoretically incorporated into all actions undertaken by the US Environmental Protection Agency (EPA). However, formally evaluating how specific policy measures influence environmental justice is challenging, especially in the context of regulatory analyses in which quantitative comparisons are the norm. We conducted a literature review to determine whether health inequality measures developed in other settings can be applied in a manner consistent with EPA concepts of environmental justice and the structure and data requirements of regulatory analyses. We concluded that an outcome-based assessment of environmental inequality, specifically considering minority and low-income populations but not restricted to between-group comparisons, would be consistent with EPA definitions and concepts. Appropriate application of these indicators would require thorough characterization of the baseline distribution of exposures or risks; exposure models stratified by both location and demographics; and dose-response models that account for vulnerability attributes that may be demographically patterned. The preferred indicators would incorporate both between-group comparisons and within-group inequality. Choosing among candidate indicators requires decisions regarding the appropriate reference point for comparisons, whether the indicators should reflect relative or absolute inequality, whether social groups of interest have inherent ordering, and whether an explicit inequality aversion parameter is preferred to make transparent any value judgments important to decision making. Overall, we found that quantitative measures of exposure or health risk inequality are theoretically justified and can provide valuable insight for regulatory analyses at EPA, provided that the input data are appropriately constructed and the indicators are selected according to explicit decisions by EPA regarding the dimensions of environmental justice of greatest interest.

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