Working papers in Transport Economics
Does benefit/cost-efficiency influence transport investment decisions?
(), Maria Börjesson
(), James Odeck
() and Morten Welde
Abstract: We explore how benefit-cost efficiency and electoral
support affect road investment decisions in Sweden and Norway. In Norway,
neither benefits nor costs seem to affect project selection. In Sweden,
civil servants’ decisions are strongly affected by projects’ benefit-cost
ratios, with a stronger effect for more expensive projects, while
politicians’ decisions are only weakly affected, and only for small
projects. In both countries, governments tend to favour investments in
regions where they enjoy strong local electoral support. Using cost
efficiency as a final selection criterion seems to filter out many
inefficient projects already at an early stage of the planning process. We
argue that even if political decisionmakers are apparently mostly governed
by other concerns than cost efficiency, civil servants at the
administrations should not shy away from preparing efficient project
suggestions for decisionmakers to choose from.
Keywords: Cost benefit analysis; Project appraisal; Public decision making; Transport investments; (follow links to similar papers)
JEL-Codes: H43; R42; R48; (follow links to similar papers)
19 pages, April 1, 2014
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- This paper is published as:
Eliasson, Jonas, Maria Börjesson, James Odeck and Morten Welde, (2015), 'Does benefit/cost-efficiency influence transport investment decisions?', Journal of Transport Economics and Policy, Vol. 49, July, No. 3, pages 377-396
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