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Integrated Model of Computable General Equilibrium and Social Cost Benefit Analysis of an Indian Oil Refinery: Future Projections and Macroeconomic Effects

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  • Shovan Ray
  • A. Ganesh-Kumar
  • Sumana Chaudhuri

Abstract

Social Cost Benefit Analysis has long been used as a useful tool to appraise the value of a range of investment projects. Various aspects of this method have been subject to scrutiny over the decades. Other aspects concerning financial flows and appropriate ‘shadow prices’ have also undergone considerable attention. This study, a sequel to a paper that ignores such macro-aggregative benefits, examines the costs and benefits of Vadinar refinery in Gujarat with a focus on this welfare dimension on society for the project. The study allows for this large-scale benefit accrual and examines the net economic benefit of refining at Vadinar by Essar Oil to the region. The framework thus explores a methodological breakthrough in SCBA studies. SCBA when combined with CGE as an analytical tool can be gainfully employed to appraise or evaluate large-scale projects like oil refineries, especially when they make a splash with their mega-sizes as the Essar Oil refinery is. [WP-2016-024]

Suggested Citation

  • Shovan Ray & A. Ganesh-Kumar & Sumana Chaudhuri, 2016. "Integrated Model of Computable General Equilibrium and Social Cost Benefit Analysis of an Indian Oil Refinery: Future Projections and Macroeconomic Effects," Working Papers id:11381, eSocialSciences.
    • Handle: RePEc:ess:wpaper:id:11381
    Note: Institutional Papers
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    References listed on IDEAS

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    1. Sumana Chaudhuri & Shovan Ray & Ganesh-Kumar, 2018. "Integrated Model of Computable General Equilibrium and Social Cost Benefit Analysis of an Indian Oil Refinery: Future Projections and Macroeconomic Effects," Journal of Infrastructure Development, India Development Foundation, vol. 10(1-2), pages 96-125, June.
    2. Sumana Chaudhuri & Shovan Ray, 2016. "Social and economic impact analysis of Vadinar refinery of Essar oil: The Case of a mega refinery," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2016-011, Indira Gandhi Institute of Development Research, Mumbai, India.
    3. Banister, David & Thurstain-Goodwin, Mark, 2011. "Quantification of the non-transport benefits resulting from rail investment," Journal of Transport Geography, Elsevier, vol. 19(2), pages 212-223.
    4. Anthony J. Venables, 2007. "Evaluating Urban Transport Improvements: Cost-Benefit Analysis in the Presence of Agglomeration and Income Taxation," Journal of Transport Economics and Policy, University of Bath, vol. 41(2), pages 173-188, May.
    5. Robson, Edward N. & Wijayaratna, Kasun P. & Dixit, Vinayak V., 2018. "A review of computable general equilibrium models for transport and their applications in appraisal," Transportation Research Part A: Policy and Practice, Elsevier, vol. 116(C), pages 31-53.
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    1. Sumana Chaudhuri & Shovan Ray & Ganesh-Kumar, 2018. "Integrated Model of Computable General Equilibrium and Social Cost Benefit Analysis of an Indian Oil Refinery: Future Projections and Macroeconomic Effects," Journal of Infrastructure Development, India Development Foundation, vol. 10(1-2), pages 96-125, June.

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    More about this item

    Keywords

    Social Cost Benefit Analysis; Economic Impact; Computable General Equilibrium (CGE) Model; Oil Refinery;
    All these keywords.

    JEL classification:

    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • C54 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Quantitative Policy Modeling
    • C55 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Large Data Sets: Modeling and Analysis
    • D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • D60 - Microeconomics - - Welfare Economics - - - General
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis

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