Arbeitspapier
Indirect Welfare Effects of Price Changes and Cost-Benefit Analysis
The effects of a policy measure often reach the consumer only after one or more intermediatesteps, for instance because the measure lowers the cost of an input for an industry producinga consumer good. This paper is concerned with the question how to measure such indirect effectscorrectly under conditions of perfect and imperfect competition. Conventional CBA measures the indirecteffects on consumers as the direct effect on other actors (e.g. the Marshallian consumer'ssurplus of the demand for the input whose price changes). Formal analysis establishes thecorrectness of this approach under perfect competition, provided that the demand curve isappropriately defined. Under less than perfect competition, the indirect effect can differ fromthe direct effect. Under monopoly the indirect effect is always larger than the direct effect.Under monopolistic competition it can be smaller, identical or larger, depending on the details ofthe model specification and on the possibility of entry.
- Sprache
-
Englisch
- Erschienen in
-
Series: Tinbergen Institute Discussion Paper ; No. 02-011/3
- Klassifikation
-
Wirtschaft
Allocative Efficiency; Cost-Benefit Analysis
Project Evaluation; Social Discount Rate
National Government Expenditures and Related Policies: Infrastructures; Other Public Investment and Capital Stock
- Thema
-
cost benefit analysis
project evaluation
indirect effects
Kosten-Nutzen-Analyse
Projektbewertung
Wohlfahrtsanalyse
Wirkungsanalyse
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Rouwendal, Jan
- Ereignis
-
Veröffentlichung
- (wer)
-
Tinbergen Institute
- (wo)
-
Amsterdam and Rotterdam
- (wann)
-
2002
- Handle
- Letzte Aktualisierung
-
20.09.2024, 08:21 MESZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Rouwendal, Jan
- Tinbergen Institute
Entstanden
- 2002