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Cost-Benefit Analysis
131 Undergraduate Public Economics
Emmanuel Saez
UC Berkeley

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OUTLINE
Chapter 8
8.1 Measuring the Costs of Public Projects
8.2 Measuring the Benefits of Public Projects
8.3 Putting It All Together
8.4 Conclusion

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DEFINITION
Cost-benefit analysis The comparison of costs and benefits
of public goods projects to decide if they should be undertaken.

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8.1

Measuring the Costs of Public Projects

Chapter 8 Cost-Benefit Analysis

The Example

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© 2007 Worth Publishers Public Finance and Public Policy, 2/e, Jonathan Gruber

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MEASURING CURRENT COSTS
Cash-flow accounting: Accounting method that calculates
costs solely by adding up w