 The first step is unproblematic. Consider agent K. K has preferences over states of the world. A representation of these preferences begins with a baseline policy and ranks all policies relative to the baseline. Specifically, it assigns a number to each state of the world such that K prefers state X to state Y if and only if the number assigned to state X is higher than the number assigned to state Y. Cost-benefit analysis defines states of the world as (policy, wealth) pairs and defines the agent’s willingness to pay for a move from state X to Y as the change in wealth in state Y that would the agent indifferent to the state X. This procedure thus links the range of numbers that the agent may assign to the agent’s wealth as willingness to pay is defined in part in terms of the agent’s ability to  pay.[26]  The procedure for assigning numbers on the basis of an individual’s willingness to pay in fact yields a representation of that agent’s preferences. Willingness to pay is a utility function that accurately represents the agent’s (ordinal) preferences over states. Notice, however, that, if the agent chooses a different baseline policy, the numbers, though ordered identically, will not be the same as those derived from the original baseline. (One sees this immediately when one notes that the baseline policy always receive a value 0.)