Benefits and Costs of the Erie Canal: A New View

Donald Vitaliano

Eastern Economic Journal, 2016, vol. 42, issue 4, No 6, 593 pages

Abstract: Abstract Ten New York canals are evaluated as an integrated transport investment covering 1817–1880. A newly estimated willingness-to-pay (WTP) of canal users augments toll revenues as a benefits stream, and all effects are rendered in real terms. Net present value is positive for a range of real discount rates from 4 to 10 percent. A Monte Carlo simulation of uncertain WTP and discount rates shows median real net present value of US$26 million, and a zero probability of negative values. Segal is shown to have grossly overstated benefits of the Erie Canal.

Keywords: Erie Canal; benefit-cost analysis; D61; R5; H42; H43 (search for similar items in EconPapers)
Date: 2016
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DOI: 10.1057/eej.2014.79

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