1. PPA 723: Managerial Economics Lecture 23: Benefit Cost Analysis 4, Examples The Maxwell School, Syracuse University Professor John Yinger

2. Managerial Economics, Lecture 23: B/C Examples Outline  Early Childhood Education  New Highway

3. Managerial Economics, Lecture 23: B/C Examples Early Childhood Education Programs ♦ Janet Currie ♦ The Journal of Economic Perspectives, Vol. 15, No. 2 (Spring, 2001), 213-238.

4. Managerial Economics, Lecture 23: B/C Examples

8. Summary: Benefit/Cost Analysis of Head Start

9. Managerial Economics, Lecture 23: B/C Examples

10. New Highway  Proposed Project  New toll road  Commuters will save time by switching from streets to the new road.

11. Managerial Economics, Lecture 23: B/C Examples Impacts of the Project, 1 Costs  Construction costs (including land)  Maintenance costs  Costs of hiring toll booth operators  Lost views or other lost amenities not reflected in price of land

12. Managerial Economics, Lecture 23: B/C Examples Impacts of the Project, 2 Key Benefits  Time savings to commuters  Time savings to drivers on existing streets  Drop in accidents (perhaps offset by a higher fatality rate for the small number of accidents on the highway )

13. Managerial Economics, Lecture 23: B/C Examples Impacts of the Project, 3 Transfers  Increased house values, especially around the entrances to the new highway.  Increased property taxes on houses, especially around the entrances to the new highway.  Tolls collected on the new highway.

14. Managerial Economics, Lecture 23: B/C Examples Impacts of the Project, 4 More Transfers  Lost retail sales on the highways that used to serve the commuters.  Decreased values of stores on these highways.  Decreased property taxes from commercial property on these highways.