The Case for the MVPF in Empirical Welfare Analysis


Hendren, Nathaniel, and Ben Sprung-Keyser. Working Paper. “The Case for the MVPF in Empirical Welfare Analysis”.
Paper385 KB


This paper outlines the case for using the Marginal Value of Public Funds (MVPF) in empirical welfare analysis. It compares the MVPF approach with more traditional welfare metrics such as the Cost-Benefit Ratio and the Net Social Benefits criterion. It outlines the advantages of the MVPF approach relative to these metrics. In building the case for the MVPF, this paper also addresses several misconceptions about the MVPF that appear in recent literature.



An earlier draft circulated under the title "The Advantages of the MVPF: A Comment on Garcia and Heckman (2022)", and is availabe here.
Last updated on 05/08/2022