Stanford University Cost Benefit Analysis

Instructions: In 1500-2000 words, answer one of the following questions. Papers must use a recognized citation system – e.g. Chicago or MLA – and must be double-spaced throughout. Students need not use sources that are not course readings. But, if students make empirical claims in their papers, they should cite a legitimate source – e.g. an academic study.

1. To fulfill the mandate of the Cameron Gulbransen Kids Transportation Safety Act of 2007, the National Highway Traffic Safety Administration, as of May 1, 2018, requires the installation of rear-view video systems in all passenger cars, trucks, multipurpose passenger vehicles, buses, and low-speed vehicles with a gross vehicle weight of less than 10,000 pounds. The purpose of the regulation is to reduce the risk of “back-over” crashes involving vulnerable populations (young children, the elderly, people with disabilities). The benefits of the regulation are estimated to be between $344-396 million (save 13-15 lives/year; prevent 1,125-1,332 injuries/year; and prevent $10-13/vehicle in damage). The costs of installing the cameras are estimated to be between $546-620 million.

What is cost-benefit analysis? What reasons might government agencies have to use this decision procedure to evaluate policies/regulations? If the National Highway Traffic Safety Administration relied solely on cost-benefit analysis to decide whether to implement the regulation in question, what would it have done? Was the National Highway Traffic Safety Administration morally justified in passing the rear-view video system regulation? Why or why not? Be sure to defend your answer. The purpose of this assumption is to have you focus on the ethical dimension of the case.