THE COST/BENEFIT ANALYSIS: IT CAN BE A MISLEADING TOOL FOR TRANSPORTATION PLANNERS

Cost benefit analysis assumes that the data used can be defined precisely, dynamic uncertainties are not accounted for, furthermore no evaluation is made of the financial risk or the range of possible revbenue figures. The author uses Monte Carlo analysis method to produce a theoretical model evaluating the net revenue as a stochastic random variable, showing that the probability distribution for net revenue is not a normal distribution. An example is given of the use of the method to determine the feasibility of offering a bus service to students who daily commute more than 30 miles to a large university. Although the model is costly and difficult to develop, only minor adjustments are required to use it on similar problems within the same area. It has the advantage that results are presented in a form that is easily understood. (TRRL)

• Availability:
  • Find a library where document is available. Order URL: http://worldcat.org/oclc/1767712
• Corporate Authors:

  GORDON AND BREACH SCIENCE PUB.

  AMSTERDAM:
  ,    
• Authors:
  • O'Leary, T J
• Publication Date: 1979

Media Info

• Features: Figures; References; Tables;
• Pagination: p. 189-193
• Serial:
  • Transportation Planning and Technology
  • Volume: 5
  • Issue Number: 4
  • Publisher: Taylor & Francis
  • ISSN: 0308-1060
  • Serial URL: https://www.tandfonline.com/toc/gtpt20/current

Subject/Index Terms

• TRT Terms: Accuracy; Benefit cost analysis; Distributions (Statistics); Hazards; Mathematical models; Monte Carlo method; Planning; Revenues; Risk assessment; Stochastic processes; Transportation; Transportation planning
• ITRD Terms: 226: Cost benefit analysis; 6473: Mathematical model; 143: Planning; 6574: Stochastic process; 1155: Transport
• Subject Areas: Planning and Forecasting; Transportation (General); I10: Economics and Administration;

Filing Info

• Accession Number: 00312308
• Record Type: Publication
• Source Agency: Transport Research Laboratory
• Files: ITRD, TRIS
• Created Date: Oct 27 1980 12:00AM