Transportation
Performance Management

Economic Analysis Primer

Official U.S. Department of Transportation Economic Values are posted on the website of the Office of the Assistant Secretary for Transportation Policy at http://ostpxweb.dot.gov/, in the section marked "Reports."

• For "Revision of Departmental Guidance on Treatment of Value of Life and Injuries" go to the Treatment of the Value of Life guidance documents on that page.
• For the "Departmental Guidance for the Valuation of Travel Time in Economic Analysis" go to the Value of Time guidance documents on that page.

• Note From the Director
• Introduction
  • Role of Economic Analysis in Highway Decision Making
  • Status of Economic Analysis
  • Role of the Federal Highway Administration
• Economic Fundamentals
  • Accounting for Dollars Over the Project Life Cycle
  • Inflation
  • Time Value of Resources
• Life-Cycle Cost Analysis
  • When to Use Life-Cycle Cost Analysis
  • Procedures for Best Results
  • Cost Elements to Include
  • User Cost Controversy
  • Tools
• Benefit-Cost Analysis
  • The Benefit-Cost Analysis Process
  • Benefit and Cost Elements to Include
  • Comparing Benefits to Costs
  • Misunderstandings
  • Avoiding Pitfalls
  • Tools
• Forecasting Traffic for Benefit Calculations
  • Traffic Flows Are Dynamic
  • Traffic Forecasting Process
  • Network and Corridor Effects
  • Impact on Benefit Calculations
  • When to Do a Full Demand Forecast
    For more detailed information on the interaction between traffic levels and new highway capacity, see "Induced Travel: Frequently Asked Questions" at www.fhwa.dot.gov/planning/itfaq.htm
• Risk Analysis
  • Defining Risk
  • Sensitivity Analysis
  • Probabilistic Analysis
  • Mitigating Risk
• Economic Impact Analysis
  • Role of Economic Impact Analysis
  • When to Do Economic Impact Analysis
  • Methods and Tools
  • Presentation of Results
• Conclusion