SOCIAL ECONOMICS AND RISK ANALYSIS

Risk analysis studies the likelihood and potential severity of harm cr eated by a hazard. Research suggests that public ''paranoia'' about en vironmental risks is a product of mistrust, and that perceptions shoul d carry weight in public policy. Application of social economic's ''du al self'' framework suggests that the willingness-to-pay approach to d eciding whether risk reduction efforts are economical is flawed in its presumption against public values, its bias against the poor and the unborn, and its neglect of risk prevention. if comparative risk analys is can minimize rent-seeking and view environmental protection as an i nvestment good, it may improve environmental policy.