The broad purpose of cost benefit analysis (CBA) is to help project evaluation and social decision making. More specifically, the objective is to facilitate the more efficient allocation of society’s resources. This course introduces the basic tools and theoretical framework for CBA. Emphasis will be placed on hand-on learning experience, and applications in the context of developing countries.

 This course consists of a 2.5 hours weekly lecture and one hour weekly tutorial. Tutorial time will be determined in the first week of the semester. 

On successful completion of this course, students will be able to: 

• understand why CBA can be used to appraise projects with an objective to improve social welfare 
• gain a understanding of the fundamentals of CBA 
• have the capacity to appreciate the appropriate steps or approaches to evaluate the financial and economic values of a project 
• understand the strength and limitations of CBA in project appraisal

There will be tutorial exercises, assignments (15%), a mid-term test (30%) and a final examination (55%).

Three and a half contact hours per week, including 2.5 lecture hours and one hour tutorial.  Consultation is by appointment. On average, students are expected to spend five to six hours outside of contact hours to complete the course.

Students with non-economics backgrounds are encouraged to consult the lecturer-in-charge regarding eligibility and assumed knowledge for the course.

Graduate Diploma Microeconomics or the equivalent. Students not majoring in economics should discuss with the lecturer before enrolling.

Perkins, F.C. (1994). Practical Cost Benefit Analysis: Basic Concepts and Applications. Macmillan, Melbourne.

Boardman, A.E. et al. (2010). Cost Benefit Analysis - Concepts and Practices, Fourth Edition, Prentice Hall, NJ.

Sinden, J.A. and Thampapillai, D.J. (1995). Introduction to Cost Benefit Analysis, Longman, Melbourne.

Campell, H. and R. Brown (2003). Benefit-Cost Analysis: Financial and Economic Appraisal Using Spreadsheets, Cambridge. 

Nas, T.F. (1996). Cost Benefit Analysis - Theory and Application. Sage, California.

Zerbe, R.O. and A.S. Bellas (2006). A Primer for Benefit-Cost Analysis, Edward Elgar Publishing.

Department of Transport and Regional Services (2005). Report 110: Risk in Cost-Benefit Analysis, Bureau of Transport and Regional Economics, Commonwealth of Australia. [Downloadable: http://www.btre.gov.au/info.aspx?ResourceId=25&NodeId=22]

Dinwiddy, C.L. (1996). Principles of Cost-Benefit Analysis for Developing Countries, Cambridge University Press.

Zerbe, R.O. and Dively, D.D. (1994). Benefit Cost Analysis in Theory and Practice, Harper Collins, NY.

Australia Department of Finance. (2006). Handbook of Cost-Benefit Analysis, Australian Publishing Service, Canberra.      

[Downloadable:http://www.finance.gov.au/publications/finance-circulars/2006/docs/

Handbook_of_CB_analysis.pdf]

Jenkins, G.P. and Harberger, A.C. (1991). Program on Investment Appraisal and Management Manual - Cost Benefit Analysis of Investment Decisions, Cambridge, Mass., Harvard Institute for International Development.

Gramlich, E. (1997). A Guide to Benefit-Cost Analysis, Waveland Publishing, NJ.

Hanley, N. and C. L. Spash (1998). Cost-benefit analysis and the environment, Edward Elgar.

Little, I.M.D. and Mirrlees, J.A. (1974). Project Appraisal and Planning for Developing Countries, London, Heinemann Educational Books.

Pearce, D.W. and Nash, C.A. (1981). The Social Appraisal of Projects: A Text in Cost Benefit Analysis, Macmillan, London.

Sassone, P.G. (1978). Cost-Benefit Analysis: A Handbook, Academic Publisher.

UNIDO (1972). Guidelines for Project Evaluation, New York, United Nations.

 The course will be delivered "on campus" with materials posted in Wattle.