Course info

The course is part of the studies in the master's programme in Agricultural, Environmental and Resource Economics (AGERE).

Learning aims:

• understand the microeconomic theory behind CBA
• learn to distinguish between impacts in primary markets and secondary markets
• learn the basics of benefit-transfer to value non-market impacts
• understand the role of the discount rate on the net present value of a project
• understand how uncertainty is incorporated into CBA in theory and practice
• understand how distributional issues can be incorporated into CBA
• critically assess CBA studies and distinguish a well-conducted CBA from a poor one

Contents:

1. Introduction to CBA

2. Microeconomic foundations of CBA I (compensating variation, equivalent variation)

3. Microeconomic foundations of CBA II (Potential Pareto Improvements)

4. Valuing changes in primary markets

5. Valuing changes in secondary (job) markets

6. Benefit transfer

7. Discounting in practice

8. Dealing with uncertainty

9. Distributional aspects

10. Social discount rate