eprintid: 26015 rev_number: 13 eprint_status: archive userid: 1482 importid: 105 dir: disk0/00/02/60/15 datestamp: 2018-05-15 08:16:21 lastmod: 2021-04-02 15:57:55 status_changed: 2018-07-24 12:42:35 type: article metadata_visibility: show creators_name: Andersson, Henrik creators_name: Hultkrantz, Lars creators_name: Lindberg, Gunnar creators_name: Nilsson, Jan-Eric creators_idrefppn: 180544101 title: Economic Analysis and Investment Priorities in Sweden’s Transport Sector ispublished: pub subjects: subjects_ECO abstract: Beginning as a planning tool within Sweden’s national road administration some 50 years ago, benefit-cost analysis (BCA) has come to be a pillar of the national transport policy because of subsequent strategic choices made by the national parliament. These choices made it necessary to widen the analysis of costs to include also externalities and a foregone conclusion was that efficient investment priorities should be made based on BCA. But no one asked whether the political decision makers or the BCA models were up to that task. This paper reviews the institutional framework and practice of BCA in Sweden for transport infrastructure investment, and considers design issues that have been and still are debated, such as whether the discount rate should include a risk term and how to account for the marginal cost of public funds. A main concern with BCA results is the underestimation of construction costs, making transport sector projects look better than they are. Several ex post analyses have established that a higher NPV ratio increases the probability of being included in the investment program proposal prepared by the agency. The requirement to let projects undergo BCA seems to make planners “trim” project proposals by trying to reduce investment costs without significantly reducing benefits. This relationship is weaker among profitable projects. Moreover, there is no correlation between rate of return and the probability of being included in the final program, which is established on political grounds. date: 2018-03-22 date_type: published publisher: Walter de Gruyter, Inc id_number: 10.1017/bca.2018.5 official_url: http://tse-fr.eu/pub/32654 faculty: tse divisions: tse language: en has_fulltext: TRUE doi: 10.1017/bca.2018.5 view_date_year: 2018 full_text_status: public publication: Journal of Benefit-Cost Analysis volume: 9 number: 1 pagerange: 120-146 refereed: TRUE issn: 2152-2812 oai_identifier: oai:tse-fr.eu:32654 harvester_local_overwrite: date harvester_local_overwrite: issn harvester_local_overwrite: faculty harvester_local_overwrite: publisher harvester_local_overwrite: id_number harvester_local_overwrite: doi harvester_local_overwrite: creators_idrefppn oai_lastmod: 2018-06-18T15:10:30Z oai_set: tse site: ut1 citation: Andersson, Henrik , Hultkrantz, Lars, Lindberg, Gunnar and Nilsson, Jan-Eric (2018) Economic Analysis and Investment Priorities in Sweden’s Transport Sector. Journal of Benefit-Cost Analysis, 9 (1). pp. 120-146. document_url: https://publications.ut-capitole.fr/id/eprint/26015/1/sweden_transport.pdf