Conceptual difficulties in Risk-Benefit Analysis

Both risks and benefits lie in future heavy discounting of future because the very low present values of cost/benefits do not give a true picture of future sufferings.

    Both have related uncertainties but difficult to arrive at expected values

    What if benefits accrue to one party and risks to another?

    Can we express risks & benefits in a common set of units?

    e.g. Risks can be expressed  in one set of units (deaths on the highway) and benefits in another (speed of travel)?

Many projects, which are highly beneficial to the public, have to be safe also.

Hence these projects can be justified using RISK-BENEFIT analysis. In these studies, one should find out.

i) What are the risks involved?

ii) What are the benefits that would accrue?

iii) When would benefits be derived and when risks have to be faced?

iv) Who are the ones to be benefited and who are the ones subjected to risk-are they the same set of people or different.

The issue here is not, say, cost-effective design but it is only cost of risk taking Vs benefit analysis.  Engineers should first  recommend  the  project  feasibility  based  on  risk-benefit analysis and once it is justified, then they may get into cost-effectiveness without increasing the risk visualized.

In all this, engineers should ask themselves this ethical question: ‘Under what conditions, is someone in society entitled to impose a risk on someone else on behalf of a supposed benefit to others.’