which means deciding which proposals have high enough benefits to justify their cost. For example, when the U.S.

Department of Transportation makes decisions about what safety systems should be required in cars or airplanes, it

will approve rules only where the estimated cost per life saved is $3 million or less.

Resources that we spend on life-saving regulations create a tradeoff. A study by W. Kip Viscusi of Vanderbilt

University estimated that when a regulation costs $50 million, it diverts enough spending in the rest of the economy

from health care and safety expenditures that it costs a life. This finding suggests that any regulation that costs

more than $50 million per life saved actually costs lives, rather than saving them.

References

Ryan, Dave. “New Report Shows Benefits of 1990 Clean Air Amendments Outweigh Costs by Four-to-One

Margin,” press release, November 16, 1999. United States Environmental Protection Agency.Accessed
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