What’s the Government Ever Done for Me? Consumer benefits of infrastructure services

This paper provides methodologies for evaluating consumer benefits of infrastructure services. We define benefit measures for consumers and, using general principles from the index number literature, derive alternative first and second order approximations to these measures under the assumption of fixed prices for market goods and services. We describe how the benefit measures and their associated approximations can be used in quantifying the economic benefits when prices are allowed to change endogenously as the provision of infrastructure services changes. Under quite nonrestrictive assumptions, a measure of welfare change is also derived.