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Cost Benefit Analysis


90-747

Units: 6

Description

As public policy analysts, we are often presented with making decisions that are economically efficient – that is, how does one gain the most benefit for society, given limited resources? Economics provides the theoretical foundation of decision-making, but putting theory into practice is not always easy. Cost-benefit analysis (CBA) is an analytical tool used to determine the worth of a project, program, or policy. It identifies and attempts to quantify the costs and benefits of the project or program and provides decision-makers with manageable information to find the “best” outcome. CBA helps managers to answer questions such as: • Does the proposal provide a net benefit to the community as a whole? • Should the project/program/policy be undertaken? • Should the project/program be continued? • Which of the alternative projects should be undertaken? The course employs various economic and statistical techniques to answer these questions, condensed into a 6-week course.

Learning Outcomes

Through a variety of activities, at the end of the course, the student should be able to:

  1. Understand the project or set of projects to be analyzed.
  2. Apply the analytic tools and techniques of CBA.
  3. Understand the limitations of CBA.
  4. Compare alternative projects/programs/policies with CBA.
  5. Communicate the results of CBA so that decisions can be made.

Prerequisites Description

(90710 Applied Economic Analysis) and (90707 Statistical Reasoning or 90711 Statistical Reasoning with R)

Syllabus