Benefit transfers: are they a satisfactory input to benefit cost analysis? An airport noise nuisance case study

Benefit cost analysis in a variety of guises has established itself as a useful tool in public policy-making. It is an approach widely adopted in appraising a wide range of infrastructure investments and has been regularly used in legal proceedings. In the context of this study, it forms a common procedure for assisting in the assessment of the social benefits and costs of airport investment. It is not, however, a technique without its limitations. Beside a range of technical concerns, conducting a comprehensive benefit cost analysis can be resource-intensive and time-consuming. Recently, there have been efforts to make its application more efficient by adopting benefit transfer procedures. This involves making use of findings from one study as inputs into other policy-making activities. While applying secondary data to a new policy issue has a long pedigree, new areas of application involve taking non-market valuations of externalities from one study and transferring them to a different policy site. This paper looks at some of the limitations of employing benefit transfers and uses noise nuisance aspect of airport investment policy appraisal as an illustrative case. Based upon a meta-regression assessment of hedonic price models, the findings suggest that caution should be exercised in conduction benefit transfers.     

Short-line railroad managers discuss their industry

In the United States, the 1980 Staggers Rail Act created a positive regulatory environment for the creation of new short-line railroads. At present there are about 450 of these railroads that have less than 250 miles of trackage. This study asked managers/owners of these railroads two basic questions. First, what do you believe is the single most important trend that is currently taking place in your industry. The most frequently noted trend was the frustration of working with the larger Class 1 railroads. Five additional trends were also identified by the respondents. The second question asked the respondents if they thought the short-line sector of the rail industry will become more or less important in the next ten years and why. About 70% of the owner/managers believed their industry would become more important in the next decade. The most commonly expressed reason for this position is that the Class 1 railroads will increasingly specialize in mainline service only. Three other rationales were also enumerated. For the managers that thought their industry would become less important, the most noted reason was their trackage would not safely transport the newer very heavy bulk commodity freight cars.     

A review of guidelines for including wider economic impacts in transport appraisal

In this paper we examine how 23 industrialised countries treat wider economic impacts (WEIs) in transport appraisals. We identify 12 different types of impacts based on these countries’ appraisal guidelines. Agglomeration impacts and Production changes in imperfect markets are the most widely accepted, being recognised by 14 and 10 countries, respectively. However, about half of the impacts are mentioned by only one country, and few recommend including the impacts directly in cost–benefit analyses. Several countries provide provisos or criteria that must be met before WEIs can be assessed in the first place. We found method recommendations for quantifying WEIs in 10 countries. However, with the exception of the UK Department for Transport’s (DfT) methodological framework, there is very little international consensus on the choice of appropriate methods. Our findings thus supplement and reinforce the conclusions from the Norwegian Official Report of the Hagen Committee [NOU 2012:16. (2012). Samfunnsøkonomiske analyser. Oslo: Departementenes servicesenter] that there is currently no established consensus on the magnitude and relevance of WEIs, or on how and which of these impacts should be taken into account in transport appraisals. Recommendations for further research and appraisal practices are provided.     

Model uncertainty and the management of a system of infrastructure facilities

The network-level infrastructure management problem involves selecting and scheduling maintenance, repair, and rehabilitation (MR&R) activities on networks of infrastructure facilities so as to maintain the level of service provided by the network in a cost-effective manner. This problem is frequently formulated as a Markov decision problem (MDP) solved via linear programming (LP). The conditions of facilities are represented by elements of discrete condition rating sets, and transition probabilities are employed to describe deterioration processes. Epistemic and parametric uncertainties not considered within the standard MDP/LP framework are associated with the transition probabilities used in infrastructure management optimization routines. This paper contrasts the expected costs incurred when model uncertainty is ignored with those incurred when this uncertainty is explicitly considered using robust optimization. A case study involving a network-level pavement management MDP/LP problem demonstrates how explicitly considering uncertainty may limit worst-case MR&R expenditures. The methods and results can also be used to identify the costs of uncertainty in transition probability matrices used in infrastructure management systems.     

Recent directions in automobile demand modeling

We identify seven areas in which recent research on auto demand has made significant progress. We discuss the importance of these areas in understanding and predicting auto demand and describe the methods that researchers have used to address them. Finally, we identify the issues that this research indicates require further investigation.     

The federal rail transit policy: Rhetoric or reality?

Almost two years ago the U.S. Department of Transportation issued a formal statement of policy on rail transit. The aim of the policy was to articulate more clearly some of the basic principles and philosophy which would guide Federal participation in urban rail transit investment. The paper examines the principal tenets of the policy and assesses its influence on local rail transit development.     

Shipping economics: where we are and looking ahead from an institutional economics perspective [1]

There have been significant changes in the nature of shipping services in recent years. These have been most notably in the liner segment, but other parts of the market have not remained static. Technology shifts have been responsible for some of the change, but there have also been developments in institutional structures and managerial approaches. The economic drivers behind the sector, however, remain relatively poorly understood, despite a copious literature on shipping. Managerial economics has tended to put emphasis on the emergence of more sophisticated logistics structures and the role of information to tighten the overall supply chain. Industrial economists have been concerned with technical change and in particular with its interaction with more liberal markets structures. Often tied with this has been interest in the underlying nature of shipping markets (e.g. competitive, monopolistic or contestable) and, depending on the outcome, whether there is price leadership, collusion, predatory behaviour or whatever. Much of this work has been aspatial, treating shipping as any other industry with distance between demand and supply ignored or incorporated in a very simplistic manner. Environmental economists have focused on matters of fuel efficiency and pollution. This paper takes a broad overview of shipping economics in the context of the larger institutional framework within which it operates. It seeks broader analysis within an institutional economics framework, but also highlights some of the problems of achieving this.