Welcome to the Data-Poor Real World: Incorporating Benefit–Cost Principles into Environmental Policymaking

Elegant multi-market models and intricate discounting methods are difficult, at times impossible to utilize in the real world because the necessary data just are not available. While there is no perfect substitute for adequate data, there are good ones that are capable of improving policy decisions. This paper describes one such substitute by way of an example: the designation of critical habitat under the Endangered Species Act for West Coast salmon and steelhead. The example shows how a cost-effectiveness approach can mitigate (to some extent) the effects of poor data on the monetary benefits of regulatory actions.