Cost-Benefit Analysis in Developing Countries: What’s Different?
There are both similarities and differences between conducting cost-benefit analysis in developed and developing countries . While the fundamental principles and theory underlying cost-benefit analysis maybe the same , the methodologies and the estimation techniques that are most appropriate in each context may substantially differ . The incompleteness and deficiencies of the labour , goods, and financial markets in developing economies may render revealed preference approaches to valuation unsuitable and inferior to stated preference models . But yet , even stated preference models are difficult to operationalize in developing countries where the literacy rates may not be too encouraging to allow for complete understanding of such valuation methods . It is largely because of the latter’s complexity that the paper here suggests the newer method of adapting to the damage schedules approach to yield meaningful and more straightforward valuation of non-market goods and services . Understanding the differences in applying cost-benefit analysis to developed and developing countries will go a long way to helping policy makers make informed decisions.
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"Principles of Cost-Benefit Analysis for Developing Countries,"
Cambridge University Press, number 9780521473583, October.
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- Beal, Diana J., 1995. "A Travel Cost Analysis of the Value of Carnarvon Gorge National Park for Recreational Use," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 63(02), August.
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