This paper presents an example of the value that system dynamics can add to conventional cost benefit analysis. A static cost benefit analysis is described for planning the supply of new mental health services across the UK and the development of this analysis into a system dynamics model is explained. By developing a bigger picture of the issue, both upstream to where patients go after treatment and downstream from where patients originate in the labour market, and by simulation of the enhanced vision, the dynamic cost benefit analysis is shown to advance understanding of the issue and plans. It questions the magnitude of the potential benefit, introduces phasing issues, surfaces structural insights, takes account of the dynamics of the labour market and forces linkages between the plan and other initiatives. An overall conclusion is that dynamic factors are often left out of cost benefit analysis simply because they cause too much complexity for decision makers, whereas system dynamics allows these factors to be included without masking the clarity of the case. The paper suggests that cost benefit analysis and system dynamics are very complimentary and should be used together in strategic planning.

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Date created

• 2007 July 29-2007 August 2

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• Document

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• Processing documentation available at: https://wiki.albany.edu/display/SCA/Processing+Ingested+Digital+Files

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298eed5a7fe199ac661be72f3a39f134

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0619e689ce89476bfd3b88323c5a9410

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System Dynamic Society Records

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• This collection is part of the University Archives