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A Comparison of Benefit Cost and Cost Utility Analysis in Practice: Divergent Policies in Sweden

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  • Hultkrantz, Lars

    ()
    (Department of Business, Economics, Statistics and Informatics)

  • Svensson, Mikael

    ()
    (Department of Economics)

Abstract

We compare state-of-the-art implementation of Benefit Cost Analysis (BCA) and Cost Utility Analysis (CUA) as tools for making priorities in allocation of national public funds in the transport sector and health sector, respectively, in Sweden. While the principal distinctions between these methods are well known, less notice has been given to a number of other differences that have emerged as national and international practices have evolved over time along separate lines. We compare cost and benefit components and economic parameter values and find some surprising disparities. There are inconsistencies, both across methods and within each method. Both can be improved by learning from the other. We also find that some current practices conflict with the underlying welfare theory and/or insights from recent empirical analysis.

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Bibliographic Info

Paper provided by Örebro University, School of Business in its series Working Papers with number 2012:5.

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Length: 27 pages
Date of creation: 03 Apr 2012
Date of revision:
Handle: RePEc:hhs:oruesi:2012_005

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Postal: Örebro University School of Business, SE - 701 82 ÖREBRO, Sweden
Phone: 019-30 30 00
Fax: 019-33 25 46
Web page: http://www.oru.se/Institutioner/Handelshogskolan-vid-Orebro-universitet/
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Keywords: Benefit Cost Analysis; Cost Utility Analysis;

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  1. Anderstig, Christer & Berglund, Svante & Eliasson, Jonas & Andersson, Matts & Pyddoke, Roger, 2012. "Congestion charges and labour market imperfections: “Wider economic benefits” or “losses”?," Working papers in Transport Economics 2012:4, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
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