Cost benefit vs cost effectiveness

Advocates for inclusive policy are often asked to make the “business case” for inclusion, often being pressed for a cost-benefit analysis of various policies. In a world with limited resources, it makes sense that policymakers want resources to provide the biggest benefit possible. However, there are several problems with the cost-benefit approach when it comes to evaluating inclusive policy.

Cost -benefit analyses attempt to place a dollar value on all the benefits a policy or program accrues relative to the costs of implementing those policies or programs. Colloquially, it asks, “What is the bang for the buck?” A major problem is how does one put a dollar value on human rights, dignity, sovereignty and other concepts? How does one even quantify such things in a meaningful way? How much is it worth to you to make decisions over your own life – your schooling, your career, your living situation, and even things as basic as when to go to the toilet? When people have various rights – say, the right to vote – do we question whether to spend money on very remote polling places is worth the cost, even if it probably won’t change the outcome of any election? No, the right of the individual to vote and the value of living in a fully democratic society are accepted in many places as fundamental. The same is true for the right for all children to receive an education, regardless of disability.

A second problem with a cost benefit study of inclusive policy within any one sector is that it is dependent on every other sector. What is the economic benefit to a child with a disability of receiving an education? It depends on the inclusivity of the labor market and the transportation system that the child faces when he or she is an adult. I will underestimate the economic returns to educating a child with a disability if the rest of the environment (e.g., labor markets, transportation systems) is also becoming more inclusive, because that estimate will be based on current data on the gains in wages from an education for a person with a disability.

Should I not build an accessible school that will last dozens of years because the road to that school is currently inaccessible? What is the cost-benefit ratio for that?

Nevertheless, we do live in a world of limited resources, and economics is important. The key standard, though, should not be a cost-benefit study, but a cost-effectiveness study. For countries ratifying the Convention on the Rights of Persons with Disabilities, it is a given that all aspects of society should be inclusive. The question is, how do we get there in the most efficient manner possible. The concept of cost-effectiveness is that an outcome is achieved with the fewest resources as possible. For example, retrofitting a school to be accessible is very costly, and may take quite some time. Building a new school to be accessible adds little if no cost, and reasonable accommodations can generally be made quickly. Thus, in terms of getting more children with disabilities into school, it may be more cost effective to have a policy that all new schools are fully accessible and reasonable accommodations are provided in inaccessible schools as needed. Reasonable accommodations are not full inclusion, but the most cost-effective way of reaching the most children within a certain amount of time and budget may be this approach.

So, if asked to do a cost-benefit study, explain that cost-effectiveness is what is needed. We don’t want to waste money on strategies that don’t work or that are unnecessarily expensive, but the question of whether we should move towards inclusion is a given.