Policy Brief—The Need for More (Not Less) External Review of Economic Analysis at the U.S. EPA

Abstract

Under President Donald Trump, the U.S. Environmental Protection Agency (EPA) has made significant changes to the way it conducts economic analyses of regulatory actions. Changes in the assumptions and methods used in regulatory impact analyses (RIAs) have produced fundamentally different conclusions about the economic benefits and costs of significant regulations. At the same time, the EPA has eliminated its Environmental Economics Advisory Committee (EEAC), which had provided external review of key inputs to the agency’s benefit–cost analyses, such as the value of a statistical life. This article describes the history and activities of the EEAC to increase understanding of the role it served and what has been lost by eliminating it. In addition, we discuss our own experience as recent EEAC members. We also present examples of the very different results produced by the Obama and Trump administrations’ economic analyses of the same EPA rules to illustrate why external review is so important for ensuring that economic analyses are credible, robust, and not influenced by political agendas.