A general classification of secondary effects has been developed to resolve definitional confusion surrounding the concept of secondary effects of development projects and to illustrate the situation that gives rise to inadequate attention to secondary effects in four common project appraisal methods. The confusion is associated with overlapping of the usual categories of costs and benefits, namely, primary versus secondary effects, direct versus indirect effects, tangible versus intangible effects, commensurable versus incommensurable effects, private versus social effects, and financial versus economic effects. Current definitions do not make it clear which elements are specific to each category of benefits or effects. Inadequate attention to secondary effects detract from the validity of the four most commonly used appraisal methods, namely, the minimum-cost method, cost-savings method, induced output method, and national income method. To overcome the short-comings affecting these methods, more use should be made of shadow prices, multiplier analysis, objective functions, sectoral or national income models, measures of consumer surplus, and sensitivity analysis. 10 references.
Detalhes
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Autor
MASSE, M.
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Data do documento
1970/01/31
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TIpo de documento
Documento de trabalho sobre o pessoal
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No. do relatório
SWP58
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Nº do volume
1
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Total Volume(s)
1
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Data de divulgação
2010/07/12
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Disclosure Status
Disclosed
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Nome do documento
Secondary effects and project appraisal
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Palavras-chave
national income;appraisal method;cost of water;factor of production;water supply facilities;production function;income and expenditure;demand curve;increase in income;variety of investment;prices of input;partial equilibrium analysis;increase in consumption;income distribution effects;water supply investment;redistribution of wealth;availability of data;department of agriculture;exchange of good;water resource development;electric power facility;demand for water;appraisal of transport;shadow price;multiplier analysis;marginal utility;appraisal reports;technological spillover;sensitivity analysis;general equilibrium;irrigation water;investment cost;social effect;economic welfare;income multiplier;value added;
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