Compare methods

	Benefit-Cost Analysis for Policy	Cost-Effectiveness Analysis for Policy
Field	Public Policy	Public Policy
Family	Process / pipeline	Process / pipeline
Year of origin	2018	2015
Originator	Welfare-economics tradition; Boardman, Greenberg, Vining & Weimer (synthesis)	Health-economics and program-evaluation tradition (Drummond et al.; Gold et al.)
Type	Monetised economic appraisal of policy options	Economic evaluation comparing cost per unit of effect
Seminal source	Boardman, A. E., Greenberg, D. H., Vining, A. R., & Weimer, D. L. (2018). Cost-Benefit Analysis: Concepts and Practice (5th ed.). Cambridge: Cambridge University Press. ISBN: 9781108415996	Drummond, M. F., Sculpher, M. J., Claxton, K., Stoddart, G. L., & Torrance, G. W. (2015). Methods for the Economic Evaluation of Health Care Programmes (4th ed.). Oxford: Oxford University Press. ISBN: 9780199665877
Aliases	Cost-Benefit Analysis in Policy, Policy Benefit-Cost Analysis, Social Benefit-Cost Analysis, BCA	Policy Cost-Effectiveness Analysis, CEA for Policy, Cost-Utility Analysis in Policy
Related	3	4
Summary	Benefit-cost analysis (BCA), also called cost-benefit analysis, is a systematic appraisal that values all the material consequences of a policy in money, discounts them to present value, and recommends the option with the greatest net social benefit. Grounded in welfare economics and the compensation principle, it asks whether the gains to those who benefit exceed the losses to those who bear the costs across society as a whole. Set out comprehensively in Boardman, Greenberg, Vining and Weimer's standard textbook and operationalised by government guidance such as the UK Treasury's Green Book, BCA is the principal efficiency test applied to public investments and regulations.	Cost-effectiveness analysis (CEA) is an economic evaluation that compares competing policies or programs by their cost relative to a single, common measure of effect — lives saved, cases averted, years of education gained, or quality-adjusted life years (QALYs). Rather than valuing outcomes in money, CEA expresses results as an incremental cost-effectiveness ratio (ICER): the extra cost of one option per extra unit of outcome it delivers compared with the next-best alternative. Codified in standard references such as Drummond and colleagues' Methods for the Economic Evaluation of Health Care Programmes and the US Panel's Cost-Effectiveness in Health and Medicine, CEA is the dominant appraisal tool for health and increasingly for other public programs with a shared outcome metric.