Building Science for Environmental Protection in the 21st Century - Science For Environmental Protection: The Road Ahead - page 128

ple dimensions of interest, and improving how uncertainties are characterized
and communicated. The issues of multidimensional decision-making and ad-
dressing uncertainty in complex systems are discussed below. EPA's economists
are cognizant of the controversies and challenges in conducting benefit-cost
studies and of the frontiers of economic research in environmental benefit-cost
analysis.
Even if benefit-cost analysis were implemented based on the recommen-
dations from Harrington et al. (2009), there are important gaps in the scope of
available work on the valuation of benefits, and the literature is becoming dated.
For example, a value-of-a-statistical life (VSL) approach is used to assign mone-
tary values to reductions in mortality risk. EPA typically bases its VSL values
on a 1992 synthesis of 26 published studies (Viscusi 1992). Although EPA does
provide more recent references to frame the discussion, including studies of how
VSL may vary as a function of life expectancy or health status, the core quanti-
tative value remains based on old studies that are not necessarily relevant to the
people most vulnerable to air-pollution health effects. Inasmuch as analyses
have consistently shown that uncertainty in VSL dominates the overall uncer-
tainty in benefit-cost analyses and given that policy choices may hinge on this
value, it seems incumbent on EPA to invest in intramural and extramural re-
search specifically on it. Similarly, with respect to morbidity outcomes, the most
recent willingness-to-pay study that was incorporated into the analysis of the
Clean Air Act Amendments (EPA 2011f) was conducted in 1994. In that bene-
fit-cost analysis, multiple key health outcomes were valued by using only cost-
of-illness information.
Valuation of the ecologic and welfare benefits of air-pollution reductions
is similarly lacking; the only dimensions monetized are the effects of reductions
in agricultural and forest productivity on the price of related goods, the willing-
ness to pay for visibility improvements (based on studies conducted 20-30 years
ago), damage to building materials, and effects on recreational fishing and tim-
ber in the Adirondacks. A recent workshop on the use of ecologic nonmarket
valuation in EPA benefit-cost analysis work concluded that “perhaps the most
surprising outcome was the realization of how few nonmarket ecological valua-
tion studies are used by the EPA” (Weber 2010).
Funding for valuation research has been reduced, and disciplinary interest
in valuation research, once a major topic in environmental-economics journals,
has diminished. Assessing and addressing gaps in the environmental-benefits
estimates should have high priority and can be tackled through research designs
that produce statistically representative samples for EPA regulatory impact as-
sessments (for the importance of standardization and sampling strategies for
water see, for example, Bruins and Heberling 2004; Van Houtven et al. 2007;
Weber 2010). The challenges in addressing these gaps are not trivial given
budget constraints and logistics barriers to collecting public data.
Two recent EPA documents discuss ecologic-valuation challenges and
strategies for the agency (EPA 2006b; EPA SAB 2009). The stated goal of
EPA's Ecological Benefits Assessment Strategic Plan is to “help improve