The objective of Cost-Benefit Analysis is to provide decision-makers with information about the social value of government-sponsored programs, projects and policies, so that they can allocate resources in a way that improves the well-being of society as a whole.  The course covers  the key concepts and tools that are essential for the evaluation of government activity by applying cost-benefit techniques, including under conditions of uncertainty.  Case studies are employed to give students the confidence and insights required to undertake their individual assignment.  Alternative decision-making approaches will also be presented to provide a perspective on the advantages and disadvantages of cost-benefit analysis.

On successful completion of this course, students will have: 

• a solid understanding of the basic rationale and techniques for applying cost-benefit analysis to government-sponsored programs, policies and projects. 
• the ability to plan and implement a cost-benefit study;
• the ability to understand and critique a cost-benefit study prepared by someone else; and
• an understanding of approaches for presenting the results of a cost-benefit study to senior officials and government ministers.

The IDEC 8088 course involves attendance at a weekly lecture of three hours (including a half hour break), plus a weekly tutorial of one hour.  Tutorial times and venues will be determined in the first week of the semester.

An understanding of at least introductory microeconomics is required.  Students not majoring in economics should seek the advice of their own area, followed by discussion with the lecturer.

IDEC 8088 is designed specifically for Masters level students.  IDEC Graduate Diploma students should enrol under the course code IDEC 8001.  Non-IDEC students should seek advice from their own area before enrolling in either course.

Boardman, AE, Greenberg, DH, Vining, AR & Weimer DL 2010, Cost-Benefit Analysis: Concepts and practice, 4^th edn, Pearson Prentice Hall, New Jersey.

The main text for the course is Boardman, AE, Greenberg, DH, Vining, AR & Weimer DL 2010, Cost-Benefit Analysis: Concepts and practice, 4^th edn, Pearson Prentice Hall, New Jersey. 

Cost Benefit Analysis covers a broad range of topics, so that a single text may not cover all relevant material.  Supplementary material will therefore be used in the course.  The following texts contain additional material that will be useful for some sections of the course, especially if students wish to explore a specific topic in more detail.  A Reading Brick is also available.

Department of Finance and Administration 2006, Handbook of Cost-Benefit Analysis, Financial Management Reference Material no. 6, Commonwealth of Australia, Canberra.  <http://www.finance.gov.au/publications/finance-circulars/2006/docs/Handbook_of_CB_analysis.pdf>

Gramlich, EM 1990, A guide to Benefit-Cost Analysis, Prentice-Hall, New Jersey. 

Luskin, D & Dobes, L 1999, Facts and furphies in benefit-cost analysis: transport, Research Report 100, Bureau of Transport Economics, Canberra.  Downloadable at <http://www.bitre.gov.au/publications/1999/report_100.aspx>

Mishan, EJ & Quah, E 2007, Cost Benefit Analysis, 5^th edn, Routledge, Oxford.

Pearce, DW & Nash, CA 1981, The social appraisal of projects.  A text in Cost-Benefit Analysis, Macmillan, London. 

Perkins, F 1994, Practical Cost Benefit Analysis, Macmillan Education, South Melbourne.

Sinden, JA & Thampapillai, DJ 1995, Introduction to benefit-cost analysis, Longman Australia, Melbourne.  http://library.anu.edu.au/record=b2520009

Zhuang, J, Liang, J, Lin, T, & De Guzman, F 2007, Theory and Practice in the Choice of Social Discount Rate for Cost-Benefit Analysis: a Survey, ERD Working Paper 94, Asian Development Bank, Manila.  Downloadable <http://www.adb.org/sites/default/files/pub/2007/WP094.pdf>