Evaluating the Economic Viability of Public Investments in Tourism

Abstract Various methods have been applied to evaluating the economic viability of public investments in tourism. In this article, we capitalize on the strengths of computable general equilibrium and cost-benefit analytical techniques and develop an integrated approach to evaluating public investmen...

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Bibliographic Details
Published in:	Journal of benefit-cost analysis 2020-01, Vol.11 (1), p.101-130
Main Authors:	Banerjee, Onil, Cicowiez, Martin, Moreda, Adela
Format:	Article
Language:	eng
Subjects:	Consumption Cost benefit analysis Cost control Development banks Economic analysis Economic development Economic impact Employment Expenditures Exports Family income GDP Gross Domestic Product Households Impact analysis Integrated approach International trade Investment Investment policy Investments Prices Tourism Viability
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Summary:	Abstract Various methods have been applied to evaluating the economic viability of public investments in tourism. In this article, we capitalize on the strengths of computable general equilibrium and cost-benefit analytical techniques and develop an integrated approach to evaluating public investments in tourism. We apply the approach to the evaluation of a US$6.25 million investment in tourism in Uruguay from the perspective of a multilateral development bank and a beneficiary government. These perspectives differ in a cost-benefit analysis (CBA) due to the timing of the costs incurred. The integrated approach is powerful in that it captures first and subsequent rounds of investment impacts of benefits and costs; resource diversion and constraints are accounted for, and the estimation of benefits is consistent with the welfare economics underpinnings of CBA.
ISSN:	2194-5888 2152-2812