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EFFECT OF NEGATIVE EXTERNALITY ELIMINATION ON TRANSPORT INFRASTRUCTURE PROJECT ASSESSMENT
Abstract
Assessment of economic efficiency of transport infrastructure projects also includes impact of these projects on the environment. This paper focuses on the effects of exogenous costs associated with removing/reducing negative externalities such as traffic noise or exhaust fumes from cars. These effects are evaluated by using Cost Benefit Analysis according to their influence on the beneficiaries. The presented analysis has been performed on the sample of 47 Czech large-scale transport infrastructure projects processed during 2013-2016 period. The paper deals with the position of the reducing negative externality effects within the total benefit of these projects. Total benefits include savings in travel and operating costs, savings in travel time costs, reduction in accident costs as well as savings in exogenous costs. These savings arise as the difference in NCF between the zero and investment options of the project. Research results have shown that savings in exogenous costs contribute to the overall utility of projects by 5%.
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