estimates of the effects of dams on income and income distribution. The results are striking and suggest that dams are disappointing investments, with an ROI of about 1 percent. They also find that the benefits primarily accrue to those inhabitants living downstream, while those living upstream suffer losses.

In Mexico, _Oportunidades_ is the principal anti-poverty program focusing on improving the education, health, and nutrition of children in rural and urban communities. _Oportunidades_ was the first social program in Mexico to carry out a rigorous independent evaluation of program impacts that included randomly assigned treatment and control groups. Given the size and ambitions of the program, officials emphasized the importance of accurate, credible data as a strategy to measure effectiveness. The results of an early evaluation focusing on the rural program showed important positive impacts on school enrollment, health clinic attendance, and nutrition (Hoddinott, et al., 2000). A 2008 study found that urban children in intervention families younger than 6 months of age at baseline grew more in both height and weight than children in comparison families. Overall, they found that _Opportunidades_ is “an effective tool to improve the growth of infants in poor urban households.” (Leroy, et al., 2008) Unfortunately, these experimental methods have led to only limited improvements in understanding the performance and outcomes of environmental regulations, either in the developed or the developing world. Experimental determination of the effects of regulation necessarily requires a situation where some regions are subject to the regulation and some are not. Despite some differences across states in the U.S., it is almost never the case that the division between the regulated and unregulated regions is random. That is not to say that there will be no influence of empirical studies on understanding the effects and costs of regulation, but that influence will have to be indirect, through a better understanding of firm and individual behaviors. For now, though, _ex post_ examination of regulations will be primarily limited to relatively simple estimations of the direct cost and benefits of regulations, based on surveys or observed price changes and measured changes in environmental quality.

As discussed further below, benefit–cost analysis (BCA) and regulatory impact analysis (RIA) are systematic processes for calculating and comparing benefits and costs of a project or regulation. To its proponents, the principal advantages of a well-executed BCA are the incentives it provides to regulators to think in quantitative terms about regulatory outcomes and to consider whether and how much those changes matter, as expressed in monetary terms. BCA also increases transparency and accountability; provides a systematic framework for consistent data collection and the identification of gaps and uncertainty in knowledge; encourages the development of metrics for both the beneficial and adverse consequences of alternative regulatory approaches, allowing for comparison; and provides the ability to aggregate dissimilar effects into one measure of net benefits based on the monetary metric.

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