SCBA is the measurement of cost of resources used in an activity in comparison.....issues...objectives...approaches....rationale....shadow pricing

1. PRESENTATION ON SOCIAL COST
ANALYSIS
Submitted To: Manisha Mam
Submitted By: Taranjit kaur
MBA 3rd Sem
16416

2. CONTENTS OF SCBA
Definition
Issues
Objectives
Approaches
Rationale
Shadow pricing

3. DEFINITION OF SCBA
SCBA is the measurement of cost
of resources used in an activity in
comparison with the value of
benefits to be derived from the
activity.

4. ISSUES OF SCBA
 Assessing the desirability of project
 Identification of costs and benefits
 Measurement of costs and benefits
 The effects of time in projects appraisal i.e risk and
uncertainty
 Presentation of results the investments criteria

5. OBJECTIVES OF SCBA
 To identify and quantify as many tangible costs and
benefits as possible.
 To find out a strategy which achieves the maximum
benefits for the minimum cost.
 To discount the costs and benefits which accrue
over a period of time to determine the feasibility of
the project.
 SCBA should also describe techniques for making
investment decisions in non-profit making
organizations .

6. APPROACHES OF SCBA
 Rationale for SCBA
 UNIDO approaches
 Net benefit in terms of economic prizes
 Saving impacts and its value
 Income distribution impact
 Adjustment for merit and demerit goods
 Little mirrless approach
 Shadow prices
 SCBA by financial institutions
 Public sector investment decisions in India

7. RATIONALE FOR SCBA
The essence of the SCBA is that
does not accept that the actual
receipts of a project adequately
measure social benefits and
actual expenditure measure social
costs. The reason is that actual
prices may be an inadequate
indicator of economic benefits and
costs.

9. PRINCIPALS OF RATIONALE SCBA
o Imperfect market conditions :-
Rationing of commodities
Minimum wage rates
Foreign exchange regulations
o External effects
o Taxes and government subsidies
o Savings and investment
o Redistribution of profits
o Merit wants

10. SHADOW PRICES
Shadow prices are derived or imputed
prices which reflect social values of
project inputs and outputs. These
prices are used in SCBA when no
market imperfections are present or
when potential or social objectives are
incorporated into the measurement
process.

11. ISSUES IN SHADOW PRICES
Choice of numeraire
Concept of tradability