Critique of cost-benefit studies, Microeconomics

Critique of Cost-Benefit Studies

Numerous criticisms have been levelled against the approach of cost benefit studies. Many of these criticisms are centred on the assumptions underlying the cost benefit studies. For instance, assumption about the average span of working life in life time returns will vary from researcher to researcher. Some of the researchers do not take waiting time for employment into account or underestimate the same. Further, job in life need not be tied to the qualification of a person. Sometimes women are not considered for certain jobs even though they have the requisite qualifications.

Promotions within a career need not be based on additional qualifications or merit. There has been a long standing debate on the role of intelligence in success in life. Intelligence, defined as native ability, an inborn potential that is inherited from one’s parentage is considered as crucial for achievement and success in life. The environmentalists reason out that intelligence is a social construct. It has no meaning when it is divorced from social life. It is fashioned by the vicarious and rich quality of the social milieu in which one lives. The level of development of a society is dependent upon the levels to which a person’s abilities can blossom. Education, whether it is formal or informal or non formal, is one of these social determinants. Believers in inherited abilities discount the value of education in life time earnings. They consider that to a large extent the success of a person in a career or self employment or business or trade depends on his intelligence which is an inborn potential. Intelligence or innate abilities of a person, his personality structure, styles of work etc. may influence his chances of getting better jobs, promotions and higher earnings.


Keeping in view all these objections to the computation of returns wherein qualifications are given status as causal variables for life time earnings of a person, researchers in the area of cost benefit studies generally allow a correction factor, by way of a coefficient (or a constant), to take care of contributions to life time earnings from all the extraneous variables. The per centage of allowance credited to these variables ranges from 20 to 30 in studies on estimates of returns.

 

Posted Date: 12/17/2012 5:14:24 AM | Location : United States







Related Discussions:- Critique of cost-benefit studies, Assignment Help, Ask Question on Critique of cost-benefit studies, Get Answer, Expert's Help, Critique of cost-benefit studies Discussions

Write discussion on Critique of cost-benefit studies
Your posts are moderated
Related Questions
REAL BUSINESS CYCLES: The extent of this module is partly indicated in the title. It is about real business cycle (RBC) theory. In addition, it exposes you to New Classical Bu

Development: Economic development is the process through that a country's economy expands and improves in both qualitative and quantitative terms. Economic development requires co


I have a chemistry project which is title: "combating desertification" so I have to come up with a practical solution to stop desertification or limit the spreading of deserts.. Is

how do oligopolistic market and monopolistic competition react to change in demand and supply ?

explain the concept of producers'' equilibrium

Suppose one were asked to recommend a price for the output of a proposed downtown parking garage, so that the project would have as large a Net Present Value as possible.  In this


Explain the how the classical school views the role of markets and government intervention in fighting business cycles The classical school believes in the smooth functioning o

Total cost curve (TC) is obtained by adding up vertically total fixed cost and total variable cost curves because the total cost is sum of total fixed cost and total variable cost