Discounting the value of natural resources in costbenefit analysis: a case study for policy making

4 p.

The impact of project announcements on property values: An empirical analysis

The study examines the property value impacts of an announcement of a project which has potential environmental impacts as distinct from other studies that address costs associated with under-construction and the operating impacts of developments. The hypothesis is that the announcement of a proposed project with potential environmental impact creates uncertainty in the property market of the affected area, and this impact is greater on properties closer to the project than those farther from it. The results of the study confirm the hypothesis and indicate that the marginal willingness to pay for properties within a 5 km distance declined by AU$17,020 per km proximity to the proposed heavy vehicle route, after the proposed route was announced. The results support the need for more holistic measurement of cost–benefit analysis of projects and provide a basis for improved consideration by policy makers of the rights of affected parties.

Cost-benefit analysis

Over the past 30 years, cost–benefit analysis (CBA) has been applied to various areas of public policies and projects. The aim of this essay is to describe the origins of CBA, classify typologies of costs and benefits, define efficiency under CBA and discuss issues associated with the use of a microeconomic tool in macroeconomic contexts.

Multi-criteria analysis and the resolution of sustainable development dilemmas: a stakeholder management approach

We demonstrate that stakeholder-oriented multi-criteria analysis (MCA) can adequately address a variety of sustainable development dilemmas in decision-making, especially when applied to complex project evaluations involving multiple objectives and multiple stakeholder groups. Such evaluations are typically geared towards satisfying simultaneously private economic goals, broader social objectives and environmental targets. We show that, under specific conditions, a variety of stakeholder-oriented MCA approaches may be able to contribute substantively to the resolution or improved governance of societal conflicts and the pursuit of the public good in the form of sustainable development. We contrast the potential usefulness of these stakeholder-oriented approaches – in terms of their ability to contribute to sustainable development – with more conventional MCA approaches and social cost–benefit analysis.

Economic analysis of a community-based falls prevention program

Objectives: To undertake a cost–benefit analysis of ‘Stay on Your Feet’, a community-based falls prevention program targeting older people at all levels of risk in New South Wales, Australia. Hospital separations were monitored in the intervention region, a control region and for the state of New South Wales as a whole. Changing admission patterns over the intervention period were used to assess the impact of the program.

Methods: Cost–benefit analysis compared the costs of the program with two estimates of savings from avoided hospital admissions. The first compared the cost of hospital admissions in the intervention region to a control region of similar demographics, while the second compared hospital utilization in the intervention region with the state of New South Wales as a whole using falls-related hospital diagnosis related group (DRG) codes.

Results: The total direct costs of the program were estimated at A$781 829. Both methods identified clear overall net benefits ranging from A$5.4 million for avoided hospitalizations alone to A$16.9 million for all avoided direct and indirect costs. The confidence intervals around these estimates were small. The average overall benefit to cost ratio for the intervention as a whole was 20.6:1.

Conclusions: These findings suggest that well-designed community-based interventions targeting falls prevention among older people are highly cost effective and a wise investment for all levels of government. The models used are conservative and are likely to underestimate the real benefit of the intervention, which may have lasted for some time beyond the life of the program.

Municipal solid waste management in the Caribbean: a benefit-cost analysis

Includes bibliography

A review of dendrogeomorphological research applied to flood risk analysis in Spain

Over the last forty years, applying dendrogeomorphology to palaeoflood analysis has improved estimates of the frequency and magnitude of past floods worldwide. This paper reviews the main results obtained by applying dendrogeomorphology to flood research in several case studies in Central Spain. These dendrogeomorphological studies focused on the following topics: (1) anatomical analysis to understand the physiological response of trees to flood damage and improve sampling efficiency; (2) compiling robust flood chronologies in ungauged mountain streams, (3) determining flow depth and estimating flood discharge using two-dimensional hydraulic modelling, and comparing them with other palaeostage indicators; (4) calibrating hydraulic model parameters (i.e. Manning roughness); and (5) implementing stochastic-based, cost–benefit analysis to select optimal mitigation measures. The progress made in these areas is presented with suggestions for further research to improve the applicability of dendrogeochronology to palaeoflood studies. Further developments will include new methods for better identification of the causes of specific types of flood damage to trees (e.g. tilted trees) or stable isotope analysis of tree rings to identify the climatic conditions associated with periods of increasing flood magnitude or frequency.

A new methodological protocol for the use of dendrogeomorphological data in flood risk analysis

Dendrogeomorphology uses information sources recorded in the roots, trunks and branches of trees and bushes located in the fluvial system to complement (or sometimes even replace) systematic and palaeohydrological records of past floods. The application of dendrogeomorphic data sources and methods to palaeoflood analysis over nearly 40 years has allowed improvements to be made in frequency and magnitude estimations of past floods. Nevertheless, research carried out so far has shown that the dendrogeomorphic indicators traditionally used (mainly scar evidence), and their use to infer frequency and magnitude, have been restricted to a small, limited set of applications. New possibilities with enormous potential remain unexplored. New insights in future research of palaeoflood frequency and magnitude using dendrogeomorphic data sources should: (1) test the application of isotopic indicators (16O/18O ratio) to discover the meteorological origin of past floods; (2) use different dendrogeomorphic indicators to estimate peak flows with 2D (and 3D) hydraulic models and study how they relate to other palaeostage indicators; (3) investigate improved calibration of 2D hydraulic model parameters (roughness); and (4) apply statistics-based cost–benefit analysis to select optimal mitigation measures. This paper presents an overview of these innovative methodologies, with a focus on their capabilities and limitations in the reconstruction of recent floods and palaeofloods.

Patient preference for falls prevention in hospitals revealed through willingness-to-pay, contingent valuation survey

Rationale, aims and objectives: Patient preference for interventions aimed at preventing in-hospital falls has not previously been investigated. This study aims to contrast the amount patients are willing to pay to prevent falls through six intervention approaches. ----- ----- Methods: This was a cross-sectional willingness-to-pay (WTP), contingent valuation survey conducted among hospital inpatients (n = 125) during their first week on a geriatric rehabilitation unit in Queensland, Australia. Contingent valuation scenarios were constructed for six falls prevention interventions: a falls consultation, an exercise programme, a face-to-face education programme, a booklet and video education programme, hip protectors and a targeted, multifactorial intervention programme. The benefit to participants in terms of reduction in risk of falls was held constant (30% risk reduction) within each scenario. ----- ----- Results: Participants valued the targeted, multifactorial intervention programme the highest [mean WTP (95% CI): $(AUD)268 ($240, $296)], followed by the falls consultation [$215 ($196, $234)], exercise [$174 ($156, $191)], face-to-face education [$164 ($146, $182)], hip protector [$74 ($62, $87)] and booklet and video education interventions [$68 ($57, $80)]. A ‘cost of provision’ bias was identified, which adversely affected the valuation of the booklet and video education intervention. ----- ----- Conclusion: There may be considerable indirect and intangible costs associated with interventions to prevent falls in hospitals that can substantially affect patient preferences. These costs could substantially influence the ability of these interventions to generate a net benefit in a cost–benefit analysis.

A novel and effective technology for mitigating nitrous oxide emissions from land-applied manures

Land-applied manures produce nitrous oxide (N2O), a greenhouse gas (GHG). Land application can also result in ammonia (NH3) volatilisation, leading to indirect N2O emissions. Here, we summarise a glasshouse investigation into the potential for vermiculite, a clay with a high cation exchange capacity, to decrease N2O emissions from livestock manures (beef, pig, broiler, layer), as well as urea, applied to soils. Our hypothesis is that clays adsorb ammonium, thereby suppressing NH3 volatilisation and slowing N2O emission processes. We previously demonstrated the ability of clays to decrease emissions at the laboratory scale. In this glasshouse work, manure and urea application rates varied between 50 and 150 kg nitrogen (N)/ha. Clay : manure ratios ranged from 1 : 10 to 1 : 1 (dry weight basis). In the 1-year trial, the above-mentioned N sources were incorporated with vermiculite in 1 L pots containing Sodosol and Ferrosol growing a model pasture (Pennisetum clandestinum or kikuyu grass). Gas emissions were measured periodically by placing the pots in gas-tight bags connected to real-time continuous gas analysers. The vermiculite achieved significant (P ≤ 0.05) and substantial decreases in N2O emissions across all N sources (70% on average). We are currently testing the technology at the field scale; which is showing promising emission decreases (~50%) as well as increases (~20%) in dry matter yields. This technology clearly has merit as an effective GHG mitigation strategy, with potential associated agronomic benefits, although it needs to be verified by a cost–benefit analysis.

Agricultura urbana, condición para el desarrollo sostenible y la mejora del paisaje

Este artículo resulta de investigaciones en torno al “enverdecimiento” de las ciudades y las oportunidades de la agricultura urbana para la alimentación de una población en constante aumento que no trabaja la tierra. También es fruto de actividades de mejora de ambientes urbanos realizadas con la Escuela de Ingenieros Agrónomos de la Universidad Politécnica de Madrid. A través de casos de agricultura urbana, entendiendo por ella el conjunto de prácticas para la producción de alimentos y plantas ornamentales dentro de las ciudades y en sus entornos, se analizan alternativas para la recuperación de espacios construidos e incremento de la calidad de vida de la población. Todo ello se traduce, además, en creación de riqueza y mejora del paisaje urbano, siempre desde criterios de sostenibilidad que favorecen el desarrollo local desde la Cumbre de la Tierra de Río de 1992 y la Conferencia sobre Desarrollo Sostenible Río+20 de 2013.

A unifying framework for metrics for aggregating the climate effect of different emissions

Multi-gas approaches to climate change policies require a metric establishing ‘equivalences’ among emissions of various species. Climate scientists and economists have proposed four kinds of such metrics and debated their relative merits. We present a unifying framework that clarifies the relationships among them. We show, as have previous authors, that the global warming potential (GWP), used in international law to compare emissions of greenhouse gases, is a special case of the global damage potential (GDP), assuming (1) a finite time horizon, (2) a zero discount rate, (3) constant atmospheric concentrations, and (4) impacts that are proportional to radiative forcing. Both the GWP and GDP follow naturally from a cost–benefit framing of the climate change issue. We show that the global temperature change potential (GTP) is a special case of the global cost potential (GCP), assuming a (slight) fall in the global temperature after the target is reached. We show how the four metrics should be generalized if there are intertemporal spillovers in abatement costs, distinguishing between private (e.g., capital stock turnover) and public (e.g., induced technological change) spillovers. Both the GTP and GCP follow naturally from a cost-effectiveness framing of the climate change issue. We also argue that if (1) damages are zero below a threshold and (2) infinitely large above a threshold, then cost-effectiveness analysis and cost–benefit analysis lead to identical results. Therefore, the GCP is a special case of the GDP. The UN Framework Convention on Climate Change uses the GWP, a simplified cost–benefit concept. The UNFCCC is framed around the ultimate goal of stabilizing greenhouse gas concentrations. Once a stabilization target has been agreed under the convention, implementation is clearly a cost-effectiveness problem. It would therefore be more consistent to use the GCP or its simplification, the GTP.

The relationship between national income and health : a new measure applied to Bangkok

The importance of good health of a population is crucial when determining social welfare. A new health-adjusted national income indicator that explores the relationships between economic growth, health and social welfare in Bangkok, Thailand from 1975 to 1999 is applied. This new approach to social welfare analysis is based on normative social choice theory, cost–benefit and systems analysis and is called (new)3 welfare economics. This paper argues that traditional measures of welfare, such as national income, fail to reflect accurately the impact of health on social welfare.

Price of unsustainability. Economic impacts of climate change

Global problems, rapid and massive regional changes in the 21st century call for genuine long-term, awareness, planning and well focused actions from both national governments and international organizations. This book wishes to contribute to building an innovative path of strategic views in handling the diverse challenges, and more emphatically, the economic impacts of climate change. Although the contributors of this volume represent several approaches, they all rely on some common grounds such as the costbenefit analysis of mitigation and adaptation, and on the need to present an in-depth theoretical and practical dimension. The research accounted for in this book tried to integrate and confront various types of economics approaches and methods, as well as knowledge from game theory to country surveys, from agricultural adaptation to weather bonds, from green tax to historical experience of human adaptation. The various themes and points of views do deserve the attention of the serious academic reader interested in the economics of climate change. We hope to enhance the spread of good solutions resulting from world wide disputes and tested strategic decisions. WAKE UP! It is not just the polar bears' habitat that is endangered, but the entire human form of life.