Distinguishing between Money income and Utility income in Cost-Benefit Analisys

Abstract

To date, the distinction between money income and utility income has been recognized only in an efficiency context. This article argues that it is also srgnificant in an income redistribution context and can be used to identify the form which such redistribution is to take, cash or kind. To illustrate its practical significance, this distinction is shown to underlie the social evaluation of time savings which appear as benefits in many public transport investments. By imputation from past railway closure decisions in the United Kingdom, a value for time twice the conventional evaluation is obtained.