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Discounting transport infrastructure investments

Disa Asplund ()
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Disa Asplund: CTS - Centre for Transport Studies Stockholm (KTH and VTI), Postal: Centrum för Transportstudier (CTS), Teknikringen 10, 100 44 Stockholm, Sweden

No 2018:23, Working papers in Transport Economics from CTS - Centre for Transport Studies Stockholm (KTH and VTI)

Abstract: The main aim of the study is to advice the Swedish national guidelines on cost-benefit analysis (CBA) of transport infrastructure investments, ASEK about the appropriate set of discount-rates (currently 3.5% for all investments). To this end, first a literature review with a theoretical focus along with some new perspectives are provided. Second the conclusions are applied to Swedish infrastructure transport CBA, using the current proposition of a new HSR line as a case. Based on empirical research concerning parameter values new discount rates are estimated, and sensitivity analysis performed. The best estimate of the social discount rate in the present study, for land transport infrastructure investment in Sweden, is about 5.1%.

Keywords: Discount rate; Cost-benefit analysis; Social time preference; Social opportunity cost; Risk (search for similar items in EconPapers)
JEL-codes: D61 G11 H43 H54 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2018-12-14, Revised 2019-12-05
New Economics Papers: this item is included in nep-pbe and nep-tre
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:ctswps:2018_023

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