Evaluation Implications of Sub-Optimum Pricing
The note focuses on three specific ways in which sub-optimal pricing can impact on project benefits: 1) through congestion and overcrowding (Section 1); 2) through overpricing and loss of user benefits (Section 2); and 3) through financial deficits...
| Main Authors: | , , |
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| Format: | Brief |
| Language: | English |
| Published: |
World Bank, Washington, DC
2012
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2005/01/6367178/evaluation-implications-sub-optimum-pricing http://hdl.handle.net/10986/11788 |
| Summary: | The note focuses on three specific ways
in which sub-optimal pricing can impact on project benefits:
1) through congestion and overcrowding (Section 1); 2)
through overpricing and loss of user benefits (Section 2);
and 3) through financial deficits which have implications
for the rest of the economy (Section 3). Sections 1-3 of the
Note seek to give practical advice on each situation,
including how to approach the economic analysis of the
situation, and the key implications for project appraisal.
If pricing policy is not known with certainty at the time of
the appraisal, then alternative pricing policies must form
part of the risk and uncertainty analysis. This is covered
in Section 4. Conclusions are given in Section 5. |
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