Towards a method for infrastructure decision making from a post-growth perspective

Abstract

As infrastructure tends to be heavy in terms of both impacts and investments, decisions in this domain are not to be taken lightly. For making logical, informed and transparent decisions, the dominant appraisal method is cost-benefit analysis (CBA). It is mandated by institutions such as the EU, World Bank and Asian Development Bank, but is also strongly criticised by environmental and social scholars. CBA gauges a project’s social desirability or ‘sustainability’ by translating and aggregating not only the economic but also the ecological and societal impacts into a monetary value, resulting in an easy-to-interpret outcome that helps navigating complex trade-offs.

But it also considers a project desirable or ‘sustainable’ no matter how severe the environmental or societal damage, as long as sufficient economic growth is generated. Thus, CBA only considers the total net impacts, without taking into account their societal, spatial or temporal distribution or existing socio-spatial inequalities, as it assumes that benefits will eventually trickle down to the disadvantaged (Sen, 2000).  

The question is: how to translate a project’s effects into an aggregated score for navigating trade-offs between positive and negative impacts, taking into account the existing distribution of benefits and burdens over environment and society in space and time? How can this ‘prioritarian appraisal’ take into account the pre-existing socio-spatial variegation of needs and boundaries, instead of assuming that overall economic growth will eventually fulfil everyone’s needs? In this contribution we therefore report on the development of a novel method for appraisal from a post-growth perspective.

To do so, we first revise appraisal’s ethical foundations, as societal desirability is ultimately a question of distributive justice. Current appraisal is rooted in ‘total’ utilitarianism and uses a linear utility function, i.e., the unit value of an asset (e.g., trees, jobs) is set by generalised standards and remains the same regardless of its scarcity or abundance for specific groups in specific spatio-temporal contexts. As an alternative, we explore the principle of prioritarianism (Adler and Norheim, 2022; Parfit, 1997). Here, the value of a project does not reflect the total absolute increase of assets, but how it affects the relative position of relevant stakeholders, i.e., prioritising the most needy. Mathematically, we translate this in using not a linear but a logarithmic, degressive utility function, where value increases with scarcity and decreases with abundance. While this principle is intuitive for many, and is used in indicators such as the Human Development Index, it has not yet been used in appraisal. 

Using a case of airport extension in the Netherlands as an example, we demonstrate the steps of prioritarian appraisal. First, the determination of entities (‘stakeholders’) between which the social, spatial or temporal distinction is relevant in the scope of the appraisal. Second, the determination and hierarchisation of basic needs the project in question is likely to affect. Third, the determination of stakeholders’ initial positions with regard to these basic needs and fourth, how the project proportionally affects these positions. For these steps, data from impact assessments studies can be used. Sixth, the construction of utility functions by taking the natural logarithm of proportional change of the stakeholders’ position with regard to their basic needs. These utility functions allows to compare the project’s desirability for each individual stakeholder, but can also be aggregated to assess the overall desirability.