Methods for estimating benefits

Crawford School of Public Policy | Executive course
Policy Essentials

Summary

This series will develop your skills to confidently undertake a basic benefit-cost analysis or a project or policy, capably review repots prepared by consultants, and prepare regulatory impact statements.

A combination of essential concepts, case studies and practical exercises is used, without the use of mathematics. The series is suitable for both beginners and as a refresher for those with an economics background.

See related course: Introduction to Benefit cost analysis.

Course date: 
9.30am–4.30pm 25 August 2020
Venue: 
#132 Crawford Building, Lennox Crossing, ANU
Cost: 

Before 6 July 2020: $1,195

After 7 July 2020: $1,495

OR $2,195 for enrolment in the Series (saving $195 off the price of purchasing each day separately).

Group discounts available.

Course overview

Drawing on basic techniques, this course explores different methods of estimating benefits, including in seemingly unquantifiable areas such as the environment. Uncertainty about the future is addressed through the ‘real options’ approach which is particularly relevant to areas such as adaptation to climate change. The course concludes with comparisons of benefit-cost analysis with cost-effectiveness analysis and multi-criteria analysis.

This course is suitable for those who have taken the ‘Introduction to benefit-cost analysis’ course and as a refresher for those with an economics background.

Theoretical underpinnings

  • Willingness to pay, willingness to accept
  • Consumer surplus, producer surplus, social surplus
  • Deadweight loss
  • Economic versus accounting depreciation
  • Primary and secondary markets

Estimated benefits

  • Revealed preference (estimating demand functions, hedonic pricing, avoided cost, travel cost method, intermediate goods method)
  • Stated preference (contingent valuation methods, choice modelling)
  • Distributional issues

Case study: Wider economic impacts in transport analysis

Risk and uncertainty

  • Knightian risk and uncertainty
  • Expected value versus Monte Carlo analysis
  • Sensitivity testing
  • Real options

Alternate approaches to decision-making

  • Cost-effectiveness analysis
  • Multicriteria analysis

Methodology:

A combination of essential concepts, case studies and practical exercises is used, without the use of mathematics. The schedule is subject to alteration to suit participants’ particular interests.

Learning outcomes include:

  • Confidently undertake a basic benefit-cost analysis of a project or policy
  • Competently review reports prepared by consultants
  • Prepare regulatory impact statements

Who should attend?

This course is suitable for both beginners and as a refresher for those with an economics background.Simple mathematics of addition, subtraction, multiplication, and area of triangle (0.5 times the base and the height) will be used.

Course presenter(s)

Dr Kaliappa Kalirajan

Dr Kaliappa Kalirajan is an applied economist and policy analyst. He received his Master’s in Mathematical Economics from Madurai University (1970), Master of Letters in Econometrics from Madurai University (1973) and Doctor of Philosophy in Economics from the Australian National University (1979). Before joining the Crawford School, he was a Professor of International Economics at the Foundation for Advanced Studies on International Development (FASID) and the National Graduate Institute for Policy Studies (GRIPS) in Tokyo. Before joining FASID and GRIPS, he was Deputy Executive Director to Executive Director, in the Australia South Asia Research Centre at The Australian National University (1994-2000).His areas of major interests include macroeconomic and trade policies and reform, poverty reduction, and sources of growth. His work on the stochastic frontier production function methodology has given him international recognition. He has several research publications in these areas in reputed academic and policy-oriented journals. He received a special commendation award from the Indian Econometric Society for his outstanding work in frontier production function analyses in December 1994. He has authored, co-authored, or edited a dozen books published by reputed international publishers.

Updated:  1 June 2020/Responsible Officer:  Crawford Engagement/Page Contact:  CAP Web Team