Planning of National Transport Infrastructure
In the Islamic Countries
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the CBA and EIA approaches (European Commission, 2014, Furberg, 2014, Kamis, 2014, Mackie,
2014, New Zealand, 2014, Schutte, 2012, Taks, 2011).
Complementary to monitoring and CBA is the impact evaluation, already applied in the context
of transports and infrastructures by the Inter-American Development Bank (2017). In
particular, it differentiates from the formers as it assesses projects considering costs and
outputs in case of implementation of the project itself and in the case it had not been taken place.
This latter scenario is defined by the Inter-American Development Bank as counterfactual, and,
unlike the CBA where the counterfactual is simulated, here it is empirically computed. The final
output of an impact evaluation could find concrete application in CBAs themselves or serve as
“input for ex-ante cost-benefit analyses of similar projects” (Inter-American Development Bank,
2017).
Financial analysis measures a project in nominal monetary values, at market prices, reflecting
the viewpoint of the owner of the asset, with expenditures on the one side (investment,
operational expenses, maintenance and working capital) and revenues on the other side (cash
income from sales or toll levies).
When implementing an assessment of a project, may it be through CBA, MCA or EIA, it is needed
to take into consideration the role that optimism in forecasting can play. Flyvbjerg (2014) and
Zembri-Mary (2017) study this case for mega infrastructure projects. In this context,
behavioural economics has a significant relevance, whereas optimism in costs budgeting leads
to an underestimation of them with respect to the concrete ones and an actual excess. The
immediate consequence is the failure in assessing correctly a project. On the other hand, the
optimism in benefits estimation would lead to a deficiency in tangible benefits. Megaprojects are
particularly subject to optimism bias and in the moment in which there is emergence of the bias
between reality and optimistic estimates, themegaproject can “break”. In this regard, Hirschman
(1967) provides the principle of the hiding hand for which optimistic underestimated costs
should be balanced by underestimation of benefits.
Another important aspect is the delay in the realization of transportation infrastructure
projects. These projects are, in fact, very vulnerable to this risk due to its complexity and its
dimensions, as seen in the case of megaprojects above. Roland Berger (2013) analyses the case
of delays in Germany and how they can seriously undermine the realization of the project itself
and an adequate delivery that meets demand requests. Delays could be intended in
administrative framework, but also due to legal procedures and there could be a link with the
aspect of optimism bias in a sense of unavailability of funding not foreseen in the phase of
evaluation.
Socio-economic analysis measures a project in real monetary values, at shadow prices, reflecting
the viewpoint of society (country or region) of the asset. The analysis includes the same
elements as in the financial analysis, including the costs to society (pollution, degraded standard
of living, biodiversity, sub standard labour condition) and benefits to society (more equal
distribution of wealth, improved environment, wider access to utilities (e.g. infrastructure). In
Germany, Italy and Spain, NTI projects that reduce regional disparities have a formal priority. In
socio-economic analysis a social preference plays a role, which is less objective, and can differ
from society to society.