Cost-Benefit Analyses

Jane McDonald

Cost-benefit analyses (CBA) are processes where the costs and benefits of an action are identified and measured in monetary terms to predict the financial impact and other consequences of decisions. Approaches to CBA provide a practical understanding of program costs and quantifiable values of program outcomes. CBA originated in an economic context. The tools for CBA first were developed within the disciplines of systems analyses, operations research, and mathematics and offered ways to understand and analyze complex issues in a seemingly rational and straightforward manner. CBA tools are used frequently in business to plan and support decision making, while educators employ these methods less often. The use of CBA in education enables school officials, policymakers, and the general public to know when the cost of educational services, programs, projects, and policy outcomes are equal to, less than, or exceed their benefits. The results of CBA help inform decisions about major ...

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