This book shows the necessity of measuring the incidence-basis indirect economic effects of public investments. The essential argument can be traced back to H. Mohring versus J. Tinbergen, the conclusions of one contradicting those of the other. Their arguments are called, respectively, transfer and existing theory of the indirect economic effect of public investments such as highways. The author has first defined the categories of generation-basis and incidence-basis economic effects in addition to the categories of direct and indirect economic effects, and has shown that it is essential to...

This volume presents the most robust and useful methodology for the measurement of the economic effects of public investments. This methodological approach solves inherent defects of the traditional methodology, namely, an ad hoc application of the cost---benefit ratio analysis based on a simple summation of itemized economic effects on public investment criteria. In particular, it comprehensively solves (1) leakage and duplication of economic effects calculated; and (2) arbitrariness of the public investment choice set. The methodology adopts the general and dynamic simulation approach and...