IN RESPONSE TO MY EARLIER POST ON THE TITANIC, reader Steven Postrel (yes, that Steven Postrel) writes:
The economist’s perspective: If you never have an accident or disaster, your precautions are too strict. One Triangle fire and one WTC disaster over the observed timespan may well be optimal or too few when balanced against the present value of the costs of having codes strict enough to prevent such tragedies.
If you prefer not to put dollar values on human life, shift to risk/risk analysis and note that a) wealthier is generally healthier, b) building codes add to costs and reduce real wealth (gross of the prevented losses), and therefore c) building codes strict enough to prevent ever having something like the WTC collapse may well kill more people over time than the collapse itself. Or you can look at how costlier building codes lead to an increase in the average age of structures (all else equal) and so may result in more people spending time in older, less-safe buildings.
You’d need to do detailed empirical work to tell what the magnitudes are for these effects; possibly the optimum safety level is more stringent than what we have now. My armchair guess is that it goes the other way, though.
Good point.