Revue d'économie et de statistique appliquée
Volume 14, Numéro 2, Pages 294-307

SUSTAINABLE DEVELOPMENT: WHICH INDICATORS FOR INVESTMENT PROJECTS CHOICE?

Authors : Rabah Bellir.

Abstract

How can the contribution of investment projects in the achievement of sustainable development be assessed? Indeed, the analysis of the available methods of project evaluation shows that the conventional indicators seek to maximize profit. Despite their scientific appearance, "shadow prices" project evaluating methods are subject to the influence of some arbitrarily selected parameters and, hence, may justify anything. As for the method of effects, it is an effective instrument as it enables the assessment of the economic impacts of a project on the national economy, in terms of integration in the national economy and dependence on foreign countries. All of these project evaluation methods do not take into consideration the effects on environment, but the Life cycle analysis provides a remedy to this omission. This approach, that assumes that inputs and outputs are converted in terms of impact on environment, leads to the conversion of all the elements impacting environment into a common assessment to produce a numerical indicator. This conversion is based on assumptions that are not accepted by all environmental experts. Ultimately, this approach offers a set of non-agreeable indicators that are difficult to perform. Sustainable development is a commendable goal; however, the project selection indicators that contribute to its realization need to be refined.

Keywords

Projects, indicators, impacts on economy, environmental impacts, project selection, sustainable development