13 Economics and Project Management in the Coastal Zone
143
would be excluded because of the lack of market price data or easily accessible direct
proxy price data.
Multi-criteria analysis and/or Environmental Impact Assessment (EIA) would be
seen as entirely separate from CBA. They might contribute to an alternative environmental appraisal process not formally linked with CBA. Environmental effects in this
interdisciplinary process would be quantified but not translated into monetary terms.
Decision-makers would be presented with two or more project/policy appraisal reports,
only one of which would contain monetary net benefit calculations. These calculations
would be restricted to those impacts directly amenable to monetary valuation and would
be based on the single criterion of economic efficiency.
13.2.2
Modified eBA Framework
In the modified CBA framework approach, conventional CBA is extended to encompass the sustainable economic development policy objective. Projects and/or courses
of action would be appraised on the basis of both economic efficiency criterion and an
equity criterion designed to monitor the distribution of costs and benefits. Both the
immediate and the long-term distribution would be assessed (i.e. intragenerational
and intergeneration equity). Benefits estimation would be utilised as extensively as
possible, incorporating as many environmental effects as was practicable given the prevailing state of the art of monetary valuation methods and techniques.
Distributional issues and environmental resource use inefficiencies (sustainability
constraints) would be responded to not by discount rate manipulation or the abandonment of discounting, but by the use of compensating offsets (shadow projects). Where
feasible and practicable, compensation for the loss of or damage to environmental assets would be actual and not merely hypothetical. Shadow projects would be identified
and fully costed. These compensation costs would then be added to the development
project's costs and included in the cost-benefit calculation. Magnitude and significance
of environmental impacts would then be standardised in monetary terms, as far as was
practicable, by economic valuation methods and techniques.
In cases where compensating offsets for environmental asset loss or damage were
not available, the social opportunity costs of foregoing the development project's net
benefits would need to be carefully considered against a range of criteria.
13.2.3
Radical Restriction of eBA Framework
The central concept in the radical restriction of CBA framework approach is the preemptive environmental standard imposed by regulatory means. These prior environmental constraints on economic development would take the form of an extensive array of environmental ambient quality standards, conservation zones and national parks,
nature reserves and other designatl;!d protected sites, etc. The standards would be set
prior to any economic analysis of the resource issues involved. EIA would playa lead
role in this standard-setting phase in terms of bio-physical and some socio-economic
data gathering and impact measurement and prediction. Political, cultural and ethical
criteria would all be deployed in the standard setting process.
143
would be excluded because of the lack of market price data or easily accessible direct
proxy price data.
Multi-criteria analysis and/or Environmental Impact Assessment (EIA) would be
seen as entirely separate from CBA. They might contribute to an alternative environmental appraisal process not formally linked with CBA. Environmental effects in this
interdisciplinary process would be quantified but not translated into monetary terms.
Decision-makers would be presented with two or more project/policy appraisal reports,
only one of which would contain monetary net benefit calculations. These calculations
would be restricted to those impacts directly amenable to monetary valuation and would
be based on the single criterion of economic efficiency.
13.2.2
Modified eBA Framework
In the modified CBA framework approach, conventional CBA is extended to encompass the sustainable economic development policy objective. Projects and/or courses
of action would be appraised on the basis of both economic efficiency criterion and an
equity criterion designed to monitor the distribution of costs and benefits. Both the
immediate and the long-term distribution would be assessed (i.e. intragenerational
and intergeneration equity). Benefits estimation would be utilised as extensively as
possible, incorporating as many environmental effects as was practicable given the prevailing state of the art of monetary valuation methods and techniques.
Distributional issues and environmental resource use inefficiencies (sustainability
constraints) would be responded to not by discount rate manipulation or the abandonment of discounting, but by the use of compensating offsets (shadow projects). Where
feasible and practicable, compensation for the loss of or damage to environmental assets would be actual and not merely hypothetical. Shadow projects would be identified
and fully costed. These compensation costs would then be added to the development
project's costs and included in the cost-benefit calculation. Magnitude and significance
of environmental impacts would then be standardised in monetary terms, as far as was
practicable, by economic valuation methods and techniques.
In cases where compensating offsets for environmental asset loss or damage were
not available, the social opportunity costs of foregoing the development project's net
benefits would need to be carefully considered against a range of criteria.
13.2.3
Radical Restriction of eBA Framework
The central concept in the radical restriction of CBA framework approach is the preemptive environmental standard imposed by regulatory means. These prior environmental constraints on economic development would take the form of an extensive array of environmental ambient quality standards, conservation zones and national parks,
nature reserves and other designatl;!d protected sites, etc. The standards would be set
prior to any economic analysis of the resource issues involved. EIA would playa lead
role in this standard-setting phase in terms of bio-physical and some socio-economic
data gathering and impact measurement and prediction. Political, cultural and ethical
criteria would all be deployed in the standard setting process.