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Benefit-cost analysis of accelerated replacement of Hong Kong’s pre-Euro IV buses

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  • Leung Weiwen

    (Singapore Management University – Economics, 90 Stamford Road Singapore, Singapore 178903, Singapore)

Abstract

Hong Kong’s franchised buses contribute significantly to its high pollution levels, which in turn result in excess mortality and hospitalizations. I show that replacing all of Hong Kong’s pre-Euro IV buses with cleaner Euro V buses would save 1260 statistical lives, among other benefits. The expected net benefit of such a project is HK$26.4 billion under a discount rate of 3.5%. This result is robust to a discount rate of 10% and a mortality decrease of half of what is expected. This is one of the first studies to estimate the public health impact of air pollution from franchised buses in Hong Kong. The city can therefore consider conducting accelerated replacement of its franchised bus fleet. Given the strongly positive result, other Asian cities with ageing bus fleets could also conduct similar benefit-cost analyses.

Suggested Citation

  • Leung Weiwen, 2013. "Benefit-cost analysis of accelerated replacement of Hong Kong’s pre-Euro IV buses," Journal of Benefit-Cost Analysis, De Gruyter, vol. 4(3), pages 335-360, December.
    • Handle: RePEc:bpj:jbcacn:v:4:y:2013:i:3:p:335-360:n:1
    DOI: 10.1515/jbca-2013-0007
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    References listed on IDEAS

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    1. Giuseppe Ruggieri, 1999. "The marginal cost of public funds in closed and small open economies," Fiscal Studies, Institute for Fiscal Studies, vol. 20(1), pages 41-60, March.
    2. Brajer, Victor & Mead, Robert W. & Xiao, Feng, 2006. "Valuing the health impacts of air pollution in Hong Kong," Journal of Asian Economics, Elsevier, vol. 17(1), pages 85-102, February.
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