Upping the game: adding costs to impacts an introduction to the special issue on costing in the field of development effectiveness

Abstract

The arguments for including cost-analysis when assessing the effectiveness and benefits of policies and interventions are compelling: in a world of limited resources, it is not enough to know whether an intervention has an effect on the desired outcomes, such as improved early-grade reading, nor even the size of the effect. Policy-makers need to know whether they can afford those effects, whether they could have achieved them more cheaply through other interventions, and what the opportunity costs are across other outcomes, sectors, and interventions. For policymakers in lowand middle-income countries (LMICs) this is all the more important as the potential benefit from scarce resources is greater. It is therefore quite astounding that across the international development field only about one in five impact evaluations include a good cost-effectiveness analysis, thus missing the opportunity to respond to the questions often foremost on policy-makers minds (Brown and Tanner, 2019). The study by Browne and Tanner (2019) points out a number of factors that limit cost analysis integration into impact evaluations. Correct and comprehensive costing is difficult and time consuming. This is compounded by low levels of training in cost data collection and analysis methods, limited interest in cost evidence from the journals that publish impact evaluations, and limited demand from funders that cost analysis be integrated into funded impact evaluations. Indeed, while ex-ante cost-effectiveness analysis was quite frequently used in international financial institutions in the early 1990’s to justify development investments, it had gone out of fashion just as the impact evaluation field was taking off. This special issue is dedicated to cost-analysis in the context of impact evaluation, as the explosion of the impact evaluation field is an extraordinary opportunity to finally get real-time, expost estimates of cost-effectiveness across interventions. The seven papers included in this special issue bring to the fore some common themes. They help us understand the challenges of collecting cost data and offer guidance on how to meet them. They provide an insight into a variety of approaches used and where more needs to be done. Below we start by briefly summarising the seven papers in this special volume. We then go on to highlight some additional costing questions related to projects and to the scaling of projects that would benefit from further attention in future costing research.