JOURNAL ARTICLE
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Methods for Project Evaluation Pretension and Redemption
Journal of Contextual Economics – Schmollers Jahrbuch, Vol. 100 (1980), Iss. 5 : pp. 485–505
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Sell, Axel
Abstract
The main lines of several approaches for project evaluation, recommended by certain International Organizations have been discussed and the existence of significant differences between these approaches and some inconsistencies within these models have been demonstrated. Given the claim of these models to be a response to other methods, such as the effects method, and of showing how a whole set of accounting prices can be systematically and logically estimated and applied, the suggested evaluation procedures are disappointing. Furthermore, if there is a budget constraint and the need for an interative procedure, then the computation of shadow prices in the described manner is neither necessary nor helpful to obtain the optimal set of projects.