Keywords: causation, cost effectiveness, cost-benefit, regulatory law, risk management, uncertainty, regulatory assessment, regulations, health hazards, environmental hazards, risk assessment, probabilistic methods
Toward a golden standard for the regulatory assessment of health and environmental hazards, part 2
We assess, in the second part of our research on the broad context of establishing a golden standard for regulatory risk assessment. The policies of international jurisdictions can (and often are) different from those in the US; yet, they are neither opposite nor inconsistent with regulating societal hazards rationally. Although rational decision-making is understood to be the normative use of economically efficient solutions, which consist of ranking alternatives by balancing risks, costs and benefits (possibly discounted, adjusted for purchasing parity and so on), we think that risk assessment is prescriptive and informative, but not necessarily normative. In Part 2, we conclude that regulatory risk management, regardless of the jurisdiction assessed, can benefit from relying on a common treatment of uncertain causation. In particular, we suggest that probabilistic methods applied from a Bayesian perspective, at least when frequentistic arguments cannot be made. Clearly, as discussed in Part 1, other representations of uncertainty can be more appropriate; however, because the courts and the legislation is still favouring probabilistic and statistical analysis when reviewing agency rules, we suggest that the prudent tack is to couch causal arguments and decision-making in probabilistic and statistical framework.