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Project evaluation with democratic decision-making: What does cost–benefit analysis really measure?

Listed author(s):
  • Nyborg, Karine

It is often argued that projects involving public good changes should be chosen on the basis of monetary valuation and cost–benefit analysis (CBA). However, CBA is not value-free. When used to measure welfare, it is based on highly controversial value judgements. When used to measure efficiency, it is based on assumptions of limited relevance to democratic decision-making processes. CBA measures total net willingness to pay, neither more nor less. While interesting in its own right, the normative significance of this indicator is not obvious.

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Article provided by Elsevier in its journal Ecological Economics.

Volume (Year): 106 (2014)
Issue (Month): C ()
Pages: 124-131

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Handle: RePEc:eee:ecolec:v:106:y:2014:i:c:p:124-131
DOI: 10.1016/j.ecolecon.2014.07.009
Contact details of provider: Web page: http://www.elsevier.com/locate/ecolecon

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