A cost analysis is the most common type of economic analysis. It estimates the resources that are required to implement an intervention—such as personnel, materials, and facilities—and their associated costs. This information helps colleges anticipate what it would take to replicate the intervention. Additionally, a cost analysis forms the basis for both cost-effectiveness and benefit-cost analyses.

A cost analysis typically has three stages:

1. Planning the analysis. Phase 1 of the cost analysis starter kit from the Institute of Education Sciences (IES) provides guidance on setting up a cost analysis. The Cost Analysis in Practice (CAP) Project also offers a checklist outlining key decisions.^[1]
2. Collecting data. MDRC offers a cost data collection workbook that was used in prior studies to capture personnel salaries, time, financial payments, supplies, and other expenditures. Program staff members can complete this spreadsheet, but researchers should review the data promptly and follow up on unclear information. For more detailed data collection, the CAP project provides an interview protocol.^[2]
3. Conducting the analysis. Phases 2 and 3 of the IES cost analysis starter kit can guide researchers as they conduct cost analyses. CAP provides three templates that are tailored to different studies and can serve as researchers’ data entry and analysis tools. CAP also provides a database of national prices and fringe rates.^[3]