Download or read book Risk and the Discount Rate for Public Investment written by Martin J. Bailey and published by . This book was released on 2006 with total page 35 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper enlarges upon some recent work regarding the appropriate discount rate for public projects and, in particular, shows more fully why risk should enter into the calculation. Indeed, we argue that efficient allocation of risk bearing is usually more difficult for government projects than it is for private ones. Therefore, if anything, the allowance for risk should be greater for government projects than it is for other-wise comparable private ones (assuming no distortions from competitive equilibrium). We then outline the implications of recent mean-variance asset pricing models for the project evaluation framework, providing an integration of the treat-ment of risk with Harberger's (1968) solution to the distortion problem. In the context of this theory we also offer specific arguments on the risks of different types mid classes of govern-ment projects.
Download or read book The Little Book of Valuation written by Aswath Damodaran and published by John Wiley & Sons. This book was released on 2011-03-29 with total page 269 pages. Available in PDF, EPUB and Kindle. Book excerpt: An accessible, and intuitive, guide to stock valuation Valuation is at the heart of any investment decision, whether that decision is to buy, sell, or hold. In The Little Book of Valuation, expert Aswath Damodaran explains the techniques in language that any investors can understand, so you can make better investment decisions when reviewing stock research reports and engaging in independent efforts to value and pick stocks. Page by page, Damodaran distills the fundamentals of valuation, without glossing over or ignoring key concepts, and develops models that you can easily understand and use. Along the way, he covers various valuation approaches from intrinsic or discounted cash flow valuation and multiples or relative valuation to some elements of real option valuation. Includes case studies and examples that will help build your valuation skills Written by Aswath Damodaran, one of today's most respected valuation experts Includes an accompanying iPhone application (iVal) that makes the lessons of the book immediately useable Written with the individual investor in mind, this reliable guide will not only help you value a company quickly, but will also help you make sense of valuations done by others or found in comprehensive equity research reports.
Download or read book Pricing the Planet s Future written by Christian Gollier and published by Princeton University Press. This book was released on 2013 with total page 244 pages. Available in PDF, EPUB and Kindle. Book excerpt: Today, the judge, the citizen, the politician, and the entrepreneur are concerned with the sustainability of our development.
Download or read book The Social Discount Rate written by Humberto Lopez and published by . This book was released on 2012 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The social discount rate measures the rate at which a society would be willing to trade present for future consumption. As such it is one of the most critical inputs needed for cost-benefit analysis. This paper presents estimates of the social discount rates for nine Latin American countries. It is argued that if the recent track record in terms of growth in the region is indicative of future performance, estimates of the social discount rate would be in the 3-4 percent range. However, to the extent that the region improves on its past performance, the social discount rate to be used in the evaluation of projects would increase to the 5-7 percent range. The paper also argues that if the social planner gives a similar chance to the low and high growth scenario, the discount rate should be dependent on the horizon of the project, declining from 4.4 percent for a 25-year horizon to less than 4 percent for a 100-year horizon.
Download or read book Rare Disasters Tail Hedged Investments and Risk Adjusted Discount Rates written by Martin L. Weitzman and published by . This book was released on 2012 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: What is the best way to incorporate a risk premium into the discount rate schedule for a real investment project with uncertain payoffs? The standard CAPM formula suggests a beta-weighted average of the return on a safe investment and the mean return on an economy-wide representative risky investment. Suppose, though, that the project constitutes a tail-hedged investment, meaning that it is expected to yield positive payoffs in catastrophic states of nature. Then the model of this paper suggests that what should be combined in a weighted average are not the two discount rates, but rather the corresponding two discount factors. This implies an effective discount rate schedule that declines over time from the standard CAPM formula down to the riskfree rate alone. Some simple numerical examples are given. Implications are noted for discounting long-term public investments and calculating the social cost of carbon in climate change.
Download or read book On the Proper Discount Rate for Public Investment Projects in Natural Resources written by Angelos Pagoulatos and published by . This book was released on 1976 with total page 28 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Measuring the Social Discount Rate Under Uncertainty written by Syed M. Ahsan and published by . This book was released on 2013 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt: It is well recognised that the issue of the social rate of discount applies only to the gains from public investment that accrues to the public sector. When it comes to measurement, however, there is a problem: Public investment in infrastructure and the like does not usually yield direct pecuniary returns to the public exchequer. Instead public capital may be plausibly argued to lead to increases in factor productivity in the private economy. This paper observes that the government typical shares in the latter gains via the collection of tax revenues. Hence to the extent the risk discount rate should reflect the co-variability between the return from public investment and that of the market, we are led to measuring the risk premium implicit in various revenue flows. We apply the above methodology to the United States budget data for the period, 1950-2000, and show that the social risk premium is relatively small vis-a-vis the market. Consequently, the use of the risk free rate as the correct risk discount rate for public sector investment would involve only a minor error. The intuition here is that the portfolio of assets embedded in the state's revenue claims provides additional diversification than is available through financial markets. Therefore, even investors holding well-diversified stock portfolios may legitimately view claims on state revenue as vehicles for further risk shifting.
Download or read book Economic Analysis of Public Investment Decisions Interest Rate Policy and Discounting Analysis written by United States. Congress. Economic Joint Committee and published by . This book was released on 1968 with total page 34 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Valuing the Future written by G. M. Heal and published by Columbia University Press. This book was released on 1998 with total page 244 pages. Available in PDF, EPUB and Kindle. Book excerpt: Heal presents a coherent framework for understanding the Earth's future from an economic perspective and offers a dynamic new blueprint for comprehending sustainability.
Download or read book Project Evaluation written by Arnold C. Harberger and published by University of Chicago Press. This book was released on 1976-07-15 with total page 342 pages. Available in PDF, EPUB and Kindle. Book excerpt: The collection of papers on social project evaluation.
Download or read book Private and Public Investment Analysis written by Thomas Palm and published by Thomson South-Western. This book was released on 1985 with total page 212 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Discount Rates for the Evaluation of Public Private Partnerships written by David F. Burgess and published by John Deutsch Inst Study of Eco Policy. This book was released on 2010 with total page 352 pages. Available in PDF, EPUB and Kindle. Book excerpt: During the 1990s, the world saw an unprecedented use of public-private partnerships (PPPs) for the delivery of public services, many of which succeeded in improving the efficiency of the delivery of public services. This book evaluates all aspects of PPPs in order to determine their overall value for money.
Download or read book Building Economics Theory and Practice written by Rosalie Ruegg and published by Springer Science & Business Media. This book was released on 2013-11-11 with total page 492 pages. Available in PDF, EPUB and Kindle. Book excerpt: We no longer build buildings like we used to nor do we pay for them in the same way. Buildings today are no longer only shelter but are also life support systems, communication terminals, data manufacturing centers, and much more. Buildings are incredibly expensive tools that must be constantly adjusted to function efficiently. The economics of building has become as complex as its design. When buildings were shelter they lasted longer than their builders. The av erage gothic master mason lived 35 or 40 years. Cathedrals took 3 or 4 hundred years to build. Cost estimates were verified by great great grandchildren of the original designer. Today, creative economics has become as important as creative design and creative building. The dient brings builder, contractor, architect, and facilities manager to account in their life time. The cost of building can therefore no longer be left to chance or act of god. Solutions are no longer as ingeniously simple as those proposed by a Flor entine builder early in the 15th century. He proposed to center the dome of S. Maria deI Fiore on a great mound of earth mixed with pennies. When the job was done street urchins would carry away the dirt in their search for the pennies. This was a serious suggestion offered by an early construction manager before Brunelleschi solved the problem more sensibly.
Download or read book Risk the Discount Rate and Investment Decisions written by Jack Hirshleifer and published by . This book was released on 1960 with total page 10 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Risk and Return for Regulated Industries written by Bente Villadsen and published by Academic Press. This book was released on 2017-04-27 with total page 362 pages. Available in PDF, EPUB and Kindle. Book excerpt: Risk and Return for Regulated Industries provides a much-needed, comprehensive review of how cost of capital risk arises and can be measured, how the special risks regulated industries face affect fair return, and the challenges that regulated industries are likely to face in the future. Rather than following the trend of broad industry introductions or textbook style reviews of utility finance, it covers the topics of most interest to regulators, regulated companies, regulatory lawyers, and rate-of-return analysts in all countries. Accordingly, the book also includes case studies about various countries and discussions of the lessons international regulatory procedures can offer. - Presents a unified treatment of the regulatory principles and practices used to assess the required return on capital - Addresses current practices before exploring the ways methods play out in practice, including irregularities, shortcomings, and concerns for the future - Focuses on developed economies instead of providing a comprehensive global reviews - Foreword by Stewart C. Myers
Download or read book Discount Rates for Public Investment Under Uncertainty written by Agnar Sandmo and published by . This book was released on 19?? with total page 19 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Public Investment Criteria written by Stephen A. Marglin and published by . This book was released on 1967 with total page 104 pages. Available in PDF, EPUB and Kindle. Book excerpt: Essay on public investment criteria and the role of cost benefit analysis in the implementation of economic planning for economic development in India - criteria include consumption benefits, costs, time factor, interest, budgetary constraints, risk and dynamics. References pp. 100 and 101.
