Is Small Beautiful? Facing Challenges in the Assessment of Small Projects
Johannus Janmaat and Julien Picault
Department of Economics, Philosophy and Political Science
I.K. Barber Faculty of Arts and Social Sciences
The University of British Columbia
Kelowna, British Columbia, Canada
Alexander Cebry
Big River Analytics
Terrace, British Columbia, Canada
Abstract
Small environmental projects, accounting for a substantial share of environmental expenditures, seldom face cost benefit analyses (CBAs). Lacking a portfolio of previous small project CBAs, benefit transfer methods are difficult to apply, particularly for benefits that exhibit distance decay. We examine a small project in the southern interior of British Columbia, calibrating a Monte Carlo simulation by benefit transfer and identifying distance decay rates that lead to break even expected project net present value. We suggest that targeted valuation studies can be used to cost effectively calibrate the WTP landscape and contribute economic valuation insights to project selection methods.