Cost-benefit analysis (CBA) is a methodology that lies at the foundation of any feasibility study for projects seeking grants from EU funds. The logic of this approach is very simple: public money (in this case the money of EU taxpayers) should bring social benefits. This means that a project that benefits only a narrow circle of owners or operators can not expect support from EU funds. The numbers are inexorable, and the private project is impossible to show as social. Many tried and spent the money in vain making a feasibility study.
However, CBA is a stand-alone tool that social administrators can use for their own purposes. It is because the notion of social benefits does not represent a foggy concept, but it is used precisely by definition and can be expressed in monetary units. All instances referred to as social benefits have an identifiable positive impact on purchasing power and/or the gross social product in a particular community. If conscientiously used, CBA analysis is a tool to generate the greatest possible benefits from existing social resources, but also a powerful policy tool that justifies undertaken investment.
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