Risk in Transport Investments
AbstractWe discuss how the standard Cost-Benefit Analysis should be modified in order to take risk (and uncertainty) into account. We propose different approaches used in finance (Value at Risk, Conditional Value at Risk, Downside Risk Measures, and Efficiency Ratio) as useful tools to model the impact of risk in project evaluation. After introducing the concepts, we show how they could be used in CBA and provide some simple examples to illustrate how such concepts can be applied to evaluate the desirability of a new project infrastructure.
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Bibliographic InfoArticle provided by Springer in its journal Networks and Spatial Economics.
Volume (Year): 12 (2012)
Issue (Month): 2 (June)
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Web page: http://www.springerlink.com/link.asp?id=106607
Cost-benefit analysis; Risk; Transportation; Large project; Value at Risk; Conditional Value at Risk;
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- Laurino, Antonio & Beria, Paolo & Grimaldi, Raffaele, 2010. "Financing transport infrastrucure projects in Italy: a critical analysis of the main approaches," MPRA Paper 29140, University Library of Munich, Germany.
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