Cost benefit analysis: applications and future opportunities.

Details

• Creators:
  Gibson, Bryan ; Wallace, Candice
• Corporate Creators:
  University of Kentucky Transportation Center ; University of Kentucky. College of Engineering
• Corporate Contributors:
  Kentucky. Transportation Cabinet ; United States. Federal Highway Administration
• Subject/TRT Terms:
  • Benefit cost analysis
  • Benefits
  • Costs
  • History
  • Literature reviews
  • Methodology
  • State departments of transportation
  • Transportation planning
  • Cost benefit analysis
  • NPV
  More +
• Publication/ Report Number:
  KTC-16-04/SPR16-517-1F
• DOI:
  http://dx.doi.org/10.13023/KTC.RR.2016.04
• Resource Type:
  Tech Report
• Geographical Coverage:
  United States
• Corporate Publisher:
  University of Kentucky Transportation Center
• Abstract:
  Cost Benefit Analysis (CBA or Benefit Cost Analysis — BCA) is an evaluation tool that state transportation agencies can ; use to compare infrastructure project options across transportation modes and gauge if the discounted value of benefits ; exceed the costs. CBA lets policymakers compare alternative project proposals to a baseline scenario, or status quo case, ; under which no investments are made. CBA is used to select which proposal is the most sensible investment — ideally, ; the project that maximizes benefits while minimizing costs should be chosen. As the use of CBA to evaluate projects and ; grant applications (e.g., TIGER Discretionary Grants) continues to grow, state transportation agencies must gain ; knowledge of CBA methodologies, especially if they want to remain competitive for federal funding. This study ; documents historical trends in CBA from literature and past studies, provides background on how CBA’s are performed, ; and describes the purpose and basic function of CBAs. The researchers investigated CBA applications and programs that ; the Kentucky Transportation Cabinet (KYTC) could potentially use to prioritize projects and identify other investment ; opportunities. This report serves as a primer on the basic elements of CBA, describes what costs and benefits are typically ; incorporated into analysis, and gives an overview of the formulas that are used to derive costs and benefits. In the ; transportation context, most benefits are derived from travel time savings and crash reductions. Typical costs include ; construction and subsequent maintenance. Researchers developed a simple workbook application that KYTC personnel ; can use run a CBA. The workbook calculates present value of costs and benefits and makes both NPV and BCR available ; to the user.
  More +
• Format:
  PDF
• Funding:
  SPR 16-517
• Download URL:
  https://rosap.ntl.bts.gov/view/dot/31017/dot_31017_DS1.pdf
• File Type:
  [PDF - 2.63 MB]
• Collection(s):
  US Transportation Collection
• Main Document Checksum:
  urn:sha256:2a59fe3bcfb1c54479cafd0afb5188760a0f279a397a5480613b23baf440be99