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Moving from Evaluation to Valuation: Improving project appraisals by monetising more social and environmental impacts

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  • Infrastructure Victoria

Abstract

This paper outlines the limitations in the current Australian approach to evaluating infrastructure projects, programs and policies. It considers how Cost-Benefit Analysis in social housing, criminal justice, health and transport sectors could be further developed or strengthened by improving the valuation of non-market impacts. For each of these four sectors, we suggest impacts that could be considered. We argue using the benefit transfer method (where proxies from other jurisdictions or studies to measure impact) is our preferred approach as a first step to extending and improving the use of Cost-Benefit Analysis in non-transport sectors. We present different methods, data sources and evaluation instruments that can be used to ascribe monetary values to more economic, social, and environmental impacts. Finally, we report a set of parameter values that are currently used in other Australian states and internationally that could be adopted for use in Victoria.

Suggested Citation

  • Infrastructure Victoria, 2016. "Moving from Evaluation to Valuation: Improving project appraisals by monetising more social and environmental impacts," Policy papers 201602, Infrastructure Victoria.
    • Handle: RePEc:inv:ppaper:201602
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    File URL: http://repec.infrastructurevictoria.com.au/RePEc/inv/ppaper/IVP201602.pdf
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    References listed on IDEAS

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    1. Lixin Cai & Guyonne Kalb, 2007. "Health status and labour force status of older working-age Australian men," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 10(4), pages 227-252.
    2. Krieger, J. & Higgins, D.L., 2002. "Housing and health: Time again for public health action," American Journal of Public Health, American Public Health Association, vol. 92(5), pages 758-768.
    3. David E. Bloom & David Canning & Bryan Graham, 2003. "Longevity and Life‐cycle Savings," Scandinavian Journal of Economics, Wiley Blackwell, vol. 105(3), pages 319-338, September.
    4. R Bonnel, 2000. "HIV/AIDS and Economic Growth: A Global Perspective*(1)," South African Journal of Economics, Economic Society of South Africa, vol. 68(5), pages 360-379, December.
    5. John Stanley & David A. Hensher & Janet Stanley & Graham Currie & William H. Greene & Dianne Vella-Brodrick, 2011. "Social Exclusion and the Value of Mobility," Journal of Transport Economics and Policy, University of Bath, vol. 45(2), pages 197-222, May.
    6. Bloom, David E. & Canning, David & Sevilla, Jaypee, 2004. "The Effect of Health on Economic Growth: A Production Function Approach," World Development, Elsevier, vol. 32(1), pages 1-13, January.
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    Cited by:

    1. Levin, Iris & Tually, Selina & De Vries, Jacqueline & Kollmann, Trevor & Stone, Wendy & Goodwin-Smith, Ian, 2023. "Innovations in stock matching and allocations: the social housing challenge," SocArXiv zf48k, Center for Open Science.

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    More about this item

    Keywords

    Cost-Benefit Analysis; Infrastructure; Project Appraisal; Project Evaluation; Health; Criminal Justice; Social Housing; Transport;
    All these keywords.

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • K00 - Law and Economics - - General - - - General (including Data Sources and Description)
    • R42 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government and Private Investment Analysis; Road Maintenance; Transportation Planning
    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General

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