Course Number: 90-747
This course provides an understanding of the economist's approach to evaluating government investments or programs.
The criterion used by private sector producers in solving similar allocation problems is profit maximization. The analogue in the public sector is maximization of net social benefits. Since it is usually quite difficult to measure theses net benefits, indeed it is often very hard even to know what to measure, and since the political process does not normally provide clear cut signals for most governmental undertakings, it is difficult to know whether the projects contemplated are worthwhile.