In what circumstances is investment in HSR worthwhile?
AbstractThe case for building new High Speed Rail (HSR) infrastructure depends its the capacity to generate social benefits which compensate for the construction, maintenance and operation costs. Decisions to invest in this technology have not always been based on sound economic analysis. A mix of arguments, besides time savings –strategic considerations, environmental effects, regional development and so forth– have often been used with inadequate evidence to support them. We have explored under what conditions net welfare gains can be expected from new HSR projects. In this paper we use some simplifying assumptions with the aim of obtaining a benchmark: the minimum level of demand from which a positive social net present value could be expected when new capacity does not provide additional benefits beyond time savings from diverted and generated demand.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 8044.
Date of creation: Dec 2007
Date of revision:
public investmest; infrastructure; cost-benefit analysis; transport; high speed rail;
Find related papers by JEL classification:
- R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General
- D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-04-15 (All new papers)
- NEP-GEO-2008-04-15 (Economic Geography)
- NEP-PPM-2008-04-15 (Project, Program & Portfolio Management)
- NEP-URE-2008-04-15 (Urban & Real Estate Economics)
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