We pay a frightful price in lost jobs and economic opportunity for what I think of as the mad pursuit of zero. When, at great expense, we have reduced the amount of a given pollutant to a few parts in a bajillion and it produces no meaningful benefit, we reduce the amounts even more. But the more of these tiny changes we implement, the more it costs. We may spend $100 for the first 99 percent improvement, $1,000 for the next half percent, and $10,000 chasing the final half percent, when there is absolutely no additional measureable protection to be gained.
From Keeping the Republic by Mitch Daniels
In the private sector marginal costs are weighed against marginal benefits. Consumers in the private sector make marginal or incremental decisions. They may be willing to spend an extra $500 in safety features in a car that delivers 20% better safety, but they may not choose to spend an extra $2,000 that only delivers an additional 5% better safety. But regulatory agencies make few marginal distinctions and will insist on the $2,000 improvement because it will “save 1,000 lives”. The result may be fewer cars sold and drivers will remain either in older or less expensive less safe cars.