Although this way of breaking it down is unintuitive to me.
I disagree with this actually.
If you’re relatively skeptical, then you should include all the “soft” estimates of costs, but only include the “hard” estimates of benefits. That’s the most skeptical treatment.
You seem to be saying that you should only compare hard numbers to hard numbers, or soft numbers to soft numbers. Only including hard estimates of costs underestimates your costs, which is exactly what you want to avoid if you’re trying to make a solid estimate of cost-effectiveness.
Concrete example: Bill Gates goes to volunteer at a soup kitchen. The hard estimate of costs is zero, because Gates wasn’t paid anything. There’s a small hard benefit though, so if you only compare hard to hard, this looks like a good thing to do.
But that’s wrong. There’s a huge “soft” cost of Gates working at the kitchen—the opportunity cost of his time which could be used doing more research on where the foundation spends its money or convincing another billionaire to take the pledge.
I disagree with this actually.
If you’re relatively skeptical, then you should include all the “soft” estimates of costs, but only include the “hard” estimates of benefits. That’s the most skeptical treatment.
You seem to be saying that you should only compare hard numbers to hard numbers, or soft numbers to soft numbers. Only including hard estimates of costs underestimates your costs, which is exactly what you want to avoid if you’re trying to make a solid estimate of cost-effectiveness.
Concrete example: Bill Gates goes to volunteer at a soup kitchen. The hard estimate of costs is zero, because Gates wasn’t paid anything. There’s a small hard benefit though, so if you only compare hard to hard, this looks like a good thing to do. But that’s wrong. There’s a huge “soft” cost of Gates working at the kitchen—the opportunity cost of his time which could be used doing more research on where the foundation spends its money or convincing another billionaire to take the pledge.