Cost – benefit analysis and large-scale infrastructure projects: state of the art and challenges
AbstractIn this paper I review the problems surrounding the use of cost – benefit analysis (CBA) in the appraisal of large-scale infrastructure projects. I define the requirements of a best-practice transport CBA and show the difficulties in achieving these for large-scale projects. The main difficulties discussed are those of forecasting over long time periods, dealing with imperfect competition in transport-using sectors to obtain estimations of wider transport benefits, introducing private finance and appraising network effects. I conclude that CBA can remain a valuable tool as part of the appraisal process but that the inputs to a CBA have to be carefully assessed, and complementary approaches, such as computable general equilibrium modelling, have a useful role to play for very large or network projects.
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Bibliographic InfoArticle provided by Pion Ltd, London in its journal Environment and Planning B: Planning and Design.
Volume (Year): 34 (2007)
Issue (Month): 4 (July)
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Web page: http://www.pion.co.uk
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- Thomopoulos, N. & Grant-Muller, S. & Tight, M.R., 2009. "Incorporating equity considerations in transport infrastructure evaluation: Current practice and a proposed methodology," Evaluation and Program Planning, Elsevier, vol. 32(4), pages 351-359, November.
- Holz-Rau, Christian & Scheiner, Joachim, 2011. "Safety and travel time in cost-benefit analysis: A sensitivity analysis for North Rhine-Westphalia," Transport Policy, Elsevier, vol. 18(2), pages 336-346, March.
- Vickerman, Roger, 2008. "Transit investment and economic development," Research in Transportation Economics, Elsevier, vol. 23(1), pages 107-115, January.
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