The ‘official’ social cost-benefit analyses of six new fast rail connection variants between Schiphol Airport and the city of Groningen has led to fierce academic debate. Like Rouwendal and Verhoef (RV), the authors support the theoretical ideal of a spatial general equilibrium model that embraces all markets and all the various imperfections so that the aggregate change in domestic consumer utilities may be both direct and consistent. By contrast, they do not agree with RV’s empirical conclusions concerning the overestimation of the benefits of the alternative University of Groningen CBA. They point to RV’s virtual total lack of attention to crucial empirical details without which judgements on overestimation and underestimation cannot be made. Theoretically, they also disagree with RV’s specific claim that employing contradictory assumptions with the different models used to evaluate the spatial imperfections of different markets necessarily leads to an overestimation of the total benefits. It is the still rather partial character of the spatial equilibrium model used (RAEM) that has most probably led to an underestimation of the total benefits as RV point out in their rightfully critical examination of the first RAEM version. (Author/publisher)
Abstract