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ECONOMIC EFFECTS OF POLLUTANTS

(See endnote 35)

The US EPA’s National Center for Environmental Economics is the key agency that provides technical expertise to all federal agencies, Congress, universities, and other organizations in analyzing the economic and health impacts of environmental regulations and policies. It has produced a book entitled Children’s Health Valuation Handbook as a reference tool to help conduct economic analyses of EPA policies that affect risks to children’s health. It is used to help estimate the value of the health benefits to children from an environmental improvement and incorporates this value into the benefit-cost analysis of the proposed rule. It utilizes the following information: hazard identification, dose-response evaluation, risk characterization, quantification specifying the ways in which changes in children’s health affect their welfare, and a monetary valuation of the welfare effects. An example of how this information is used would be when the Food and Drug Administration conducted an economic analysis while developing final regulations concerning the safe and sanitary processing of fruit and vegetable juices. There was a determination made of the long-term toxic effects in children due to lead and also illnesses because of E. coli and the potential long-term cost involved to rectify these situations. Another example would be the estimated cost of the developmental delays due to prenatal secondhand smoke exposure in New York City. The estimate of this was $50 million dollars a year.

The economic cost of disease and disabilities caused by environmental contaminants is usually measured using an “environmentally attributable fraction” (EAF) model. This model estimates the proportion of the cost attributed to environmental exposures to contaminants. The cost of illness estimates is based on direct healthcare costs, including hospital and nursing home care, prescription drugs, home care, physician care, and other related services, and indirect costs from lost productivity due to disease and premature death. Costs not included, which may be very significant, are those related to the psychological and emotional loss to patients, families, friends, and communities.

 
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