Cost-benefit Analysis of Public Investments and Policy Measures

1987 ◽  
pp. 112-154
Author(s):  
Peter Bohm
Keyword(s):  
Cost Benefit Analysis ◽  
Cost Benefit ◽  
Benefit Analysis ◽  
Public Investments ◽  
Policy Measures

Evaluating the Economic Viability of Public Investments in Tourism

2019 ◽  
Vol 11 (1) ◽  
pp. 101-130
Author(s):  
Onil Banerjee ◽  
Martin Cicowiez ◽  
Adela Moreda
Keyword(s):  
Computable General Equilibrium ◽  
Cost Benefit Analysis ◽  
Cost Benefit ◽  
Analytical Techniques ◽  
Integrated Approach ◽  
Economic Viability ◽  
Benefit Analysis ◽  
Development Bank ◽  
Public Investments ◽  
Benefits And Costs

AbstractVarious methods have been applied to evaluating the economic viability of public investments in tourism. In this article, we capitalize on the strengths of computable general equilibrium and cost-benefit analytical techniques and develop an integrated approach to evaluating public investments in tourism. We apply the approach to the evaluation of a US$6.25 million investment in tourism in Uruguay from the perspective of a multilateral development bank and a beneficiary government. These perspectives differ in a cost-benefit analysis (CBA) due to the timing of the costs incurred. The integrated approach is powerful in that it captures first and subsequent rounds of investment impacts of benefits and costs; resource diversion and constraints are accounted for, and the estimation of benefits is consistent with the welfare economics underpinnings of CBA.

scholarly journals The Cost-Benefit Fallacy: Why Cost-Benefit Analysis Is Broken and How to Fix It

2021 ◽  
pp. 1-25
Author(s):  
Bent Flyvbjerg ◽  
Dirk W. Bester
Keyword(s):  
Resource Allocation ◽  
Cost Benefit Analysis ◽  
Statistical Significance ◽  
Cost Benefit ◽  
Policy Implications ◽  
Benefit Analysis ◽  
Costs And Benefits ◽  
Cost Overruns ◽  
Public Investments ◽  
The Cost

Abstract Most cost-benefit analyses assume that the estimates of costs and benefits are more or less accurate and unbiased. But what if, in reality, estimates are highly inaccurate and biased? Then the assumption that cost-benefit analysis is a rational way to improve resource allocation would be a fallacy. Based on the largest dataset of its kind, we test the assumption that cost and benefit estimates of public investments are accurate and unbiased. We find this is not the case with overwhelming statistical significance. We document the extent of cost overruns, benefit shortfalls, and forecasting bias in public investments. We further assess whether such inaccuracies seriously distort effective resource allocation, which is found to be the case. We explain our findings in behavioral terms and explore their policy implications. Finally, we conclude that cost-benefit analysis of public investments stands in need of reform and we outline four steps to such reform.

scholarly journals Integration between Transport Models and Cost-Benefit Analysis to Support Decision-Making Practices: Two Applications in Northern Italy

2018 ◽  
Vol 2018 ◽  
pp. 1-16 ◽  
Author(s):  
Paolo Beria ◽  
Alberto Bertolin ◽  
Raffaele Grimaldi
Keyword(s):  
Network Effects ◽  
Cost Benefit Analysis ◽  
Consumer Surplus ◽  
Cost Benefit ◽  
Benefit Analysis ◽  
Sustainable Mobility ◽  
Transport Models ◽  
Planning Stage ◽  
Public Investments ◽  
Operative Case

Decisions on transport plans and projects involve relevant public investments and may also determine radical changes in users’ costs. Unfortunately, it is not rare that—especially at the strategic planning stage—decisions on alternative projects or scenarios are made on a qualitative basis or, at best, by setting some indicators and verifying how much they reach the politically decided targets (e.g., “increasing the use of bicycles by 10%”). In order to reduce subjectivity, a more quantitative and comprehensive approach to the evaluation is needed. A Cost-Benefit Analysis is a tool commonly used to assess public expenditure, but its application to mobility plans introduces further practical and theoretical complexities. In this paper, we will thus try to contribute to the topic of the assessment of both sustainable mobility transport plans and infrastructure projects by presenting the operative application of a CBA methodology that is, at the same time, theoretically coherent and rich in outputs to support the decision-maker. Moreover, we will discuss the possible use of GIS software in order to provide to the decision-makers a clear and immediate “picture” of the effects on the network linked to different scenarios. The structure is as follows. Firstly, we discuss the complexities involved in the evaluation of plans with respect to a single infrastructure. Secondly, we introduce the available approaches for the assessment of consumer surplus, namely, the Rule of Half and the logsum function method, which allow the perfect integration between CBA and transport models. Thirdly, we present, through some operative case studies, the methodologies applied to the assessment and the network effects visualization of the urban mobility plan and new infrastructures. Finally, we underline how we can make the results more understandable to politicians, policy-makers, stakeholders, and citizens and in general improve the transparency and the awareness of the choices.

VP129 Social Cost Benefit Analysis (SCBA) Of Three Alcohol Policy Measures

2017 ◽  
Vol 33 (S1) ◽  
pp. 207-207
Author(s):  
Ardine de Wit ◽  
Paul van Gils ◽  
Eelco Over ◽  
Joran Lokkerbol ◽  
Filip Smit ◽  
...  
Keyword(s):  
Traffic Accidents ◽  
Social Cost ◽  
Cost Benefit Analysis ◽  
Cost Benefit ◽  
Economic Consequences ◽  
Alcohol Policy ◽  
Benefit Analysis ◽  
Costs And Benefits ◽  
Positive Effects ◽  
Policy Measures

INTRODUCTION:Alcohol abuse and addiction lead to a high disease burden for the persons concerned. Moreover, it has economic consequences for society, including costs of health care, costs due to reduced productivity, criminal activities, traffic accidents, and violence, both in private and public domains. The aim of this study was to perform a social cost-benefit analysis (SCBA) of three policy measures (tax increase, reducing number of sales venues, and advertising ban) over a period of 50 years, along with the distribution of costs and benefits among stakeholders (1).METHODS:The analysis follows Dutch guidelines for performing SCBAs. Costs and benefits in eight different domains were comprehensively identified. Model simulations were used to estimate future social costs and benefits of three policy measures, compared to not intervening.RESULTS:Over a period of 50 years, the greatest social benefits were expected from a tax increase. The cumulative discounted net monetary benefit over a period of 50 years is EUR12 billion (95 percent Confidence Interval, CI EUR11-EUR13billion) in the 50 percent tax increase scenario. The net benefits of the other two measures are smaller. The cumulative discounted value to society of a 10 percent decrease in outlet density over a 50-year period amounts to EUR4 billion (range: EUR3 - EUR5 billion). A total media ban with an estimated reduction of 4 percent in alcohol consumption leads to an expected cumulative discounted value to society over a 50-year period of EUR7 billion.CONCLUSIONS:All policy scenarios lead more or less to positive effects for society. The greatest benefits are associated with measures aimed at raising the excise tax on alcohol. Estimations as made in this study may serve to inform alcohol policy in the Netherlands.

The Social Cost-Benefit Analysis as Estimation Methodology: Case Study for Infrastructure Projects

2014 ◽  
Vol 11 (2) ◽  
pp. 57-76
Author(s):  
Samanta Petohleb Černeha ◽  
Maja Klun ◽  
Srečko Devjak
Keyword(s):  
Cost Benefit Analysis ◽  
Cost Benefit ◽  
Benefit Analysis ◽  
The Public ◽  
Public Investments ◽  
The Social ◽  
Net Profit ◽  
Expected Benefits ◽  
Theoretical Issues

Local public investments are financed by budget funds (state, county, local), debt funds (loans or credits, municipal obligations) and non-debt funds (users’ charges and methods and techniques of public-private partnership). In this paper some theoretical issues about cost-benefit analysis (CBA) and advantages and limitations in applying it are discussed. CBA is used in the public sector in making decisions where it is relatively easy to determine the costs, but the expected benefits can be difficult to express in monetary value. To ensure an equitable quantity of financial sources according to negative difference between inflows and outflows is one of the most important goals of the project. Based on theoretical framework about CBA, a calculation was made on social profitability of the project Public sewerage and water protection in the Region of Istria. The main conclusion of this paper is that if the project achieves the social profitability, net profit and high economic internal rate of return, it is possible to accept the realization of the project.

Sign in / Sign up

Export Citation Format

Share Document