What is Cost Benefit Analysis?

Part 1: Understanding the new science TEKS

Next year, students in Texas will be introduced to new science topics. Two important new topics students will learn are:

• Cost Benefit Analysis

• Global Energy Poverty

Learning these concepts will include real life applications and provide context to the scientific information students learn in the classroom.

Cost benefit analysis is how business leaders, policy makers, engineers, and people every day make decisions about how to best use resources. For example, when you choose whether to eat a cheeseburger or go for a run, you weigh costs (like calories) and benefits (like health) in order to make a decision about what is best for your body (your resource). Ideally, cost benefit analysis helps us to make the best decisions against all of the alternatives. 

So how does cost benefit analysis work in science? Let’s take electric vehicles (EVs) as an example. EVs are often cited as being better for the environment because they emit zero carbon emissions on the road. But is that the full story? Are there other factors to consider? For example, minerals for EVs are sourced using child labor. Tires wear out more quickly on EVs due to their increased weight from the batteries, leading to air quality issues. 

Evaluating the pros and cons of these decisions shows students how decision making happens in the real world. It also provides students an opportunity to see that in life, few things are black and white. In the words of Thomas Sowell, “There are no solutions, only trade-offs.”

To learn more about cost benefit analysis, check out this TEd Talk from Dr. Scott Tinker. This Google Doc Discussion Guide goes with the video and can be used with your class when teaching them about cost benefit analysis.