SCGE modelling in cost-benefit analysis: The Dutch experience

Spatial computable general equilibrium (SCGE) models offer opportunities for computing wider economic effects in cost-benefit analysis (CBA) in a theoretically satisfactory way. This is important for the correct estimation of additional economic benefits and international relocation impacts. In the Netherlands, this potential has only been reached partly. Many different types of models are actually used, none of which yet covers all relevant markets. In CBAs carried out in recent years, ad hoc methods were used more often than models, let alone SCGE models. Moreover, the usual presentation of the model outcomes appears as a 'black box' to policy makers. There is much work to be done, in extending SCGE models to strengthen their empirical basis, and in improving the presentation of the outcomes.