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Extra resources for Improving the Practice of Transport Project Appraisal (ITF Round Tables)
Sample text
Some references on the corresponding theoretical problems are Calthrop, de Borger and Proost (2009) and Mayeres and Proost (1997). IMPROVING THE PRACTICE OF TRANSPORT PROJECT APPRAISAL – © OECD/ITF 2011 THE PRACTICE OF COST-BENEFIT ANALYSIS IN TRANSPORT: THE CASE OF FRANCE – 47 These effects can be analysed on an individual basis by using correcting factors for traditional CBA. CBA in partial equilibrium can also be replaced with an analysis using general equilibrium models (GEM). This latter option has the advantage of providing not only an overall indicator of the rate of return of the operation and the collective surplus that it generates, but also a distribution of this surplus according to its beneficiaries (Brocker, 2005).
More important and more difficult to address are the situations of imperfect competition, such as a monopoly or duopoly maximising their profits, which are increasingly frequent in the transport sector. This is the case in air transport in Europe, in which markets are mostly oligopolistic; it is also the case in the rail sector in Europe in which rail competition in most markets has led to the emergence of a small number of competitors, who are also in an oligopolistic situation. , 2010). In this case, traffic studies also need to be revised by considering that operators’ prices are endogenous and are the result of market equilibrium.
As the title of the Circular published on 9 December 2008 (Ministry of Ecology, 2008a) suggests – the “Ministry evaluation reference system” – the thinking behind it is completely different. It concerns all of the Ministry’s spheres of decision and not just transport. It proposes an evaluation procedure which is very different from the previous system, where cost-benefit analysis was at the heart of the evaluation. Here, the evaluation starts by defining the project aims and assessing how that project will meet them in comparison with the other possible alternatives.