The White House on Thursday revised the way agencies weigh regulatory costs and benefits for the first time in 20 years. It resulted in new guidance that experts say will make it tougher for industries to challenge rules on the basis of their economic costs, and easier for agencies to justify stronger safeguards for public health and the environment... “This update certainly supports higher valuations of the social cost of carbon because it is broadly consistent with the approach that EPA is taking,” said [Max] Sarinsky of NYU.
Burcin Ünel, executive director of the Institute for Policy Integrity at New York University School of Law, says the new guidance “will help government agencies catch up to best practices in economics [and] guidance will help ensure that regulators do not ignore equity concerns, which have long been a blind spot in most rulemakings.
The change is consistent with voluminous academic research into discounting, and is “actually a conservative estimate,” said Peter Howard, economics director at the New York University School of Law’s Institute for Policy Integrity. A future administration could raise the discount rate again, but would “have to provide a rational justification” for doing so, Howard said.
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