The socio-economic calculation has been employed in France for assessing transportation infrastructure projects for decades. Since 2013, it has been widely applied to all public civil investments over €20 million. The report from France Stratégie explores whether this method can be extended to countable operating expenses that are equivalent to social investments. Social investments refer to measures aimed at increasing the human capital of beneficiaries.
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Methodology: Socio-economic calculation aims to measure the social value of public policies by comparing their costs and benefits, both present and future, using cost-benefit analysis. This method allows for comparing different types of effects (time savings, health improvements, carbon emissions, education level increases) into a common monetary unit through reference values.
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Challenges: Estimating the raw effects of social policies is difficult due to their widespread and heterogeneous impacts within populations. These effects are harder to predict than those of new infrastructure projects. This challenge encourages randomised experiments and longitudinal population tracking for better understanding of policy impacts over time.
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Potential Benefits: Applying socio-economic calculations to social investments could improve evaluation efficiency, as these policies can be quickly restructured based on evaluation outcomes. This contrasts with physical public investments, which remain fixed post-construction.
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Limitations: Currently, the main hurdle is estimating the raw effects of social policies before actualisation and monetisation, especially given the complexity of their impacts compared to those of physical infrastructure.
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Recommendations: To overcome these challenges, France Stratégie suggests focusing on randomised trials and longitudinal studies, conducting systematic literature reviews, and performing meta-analyses. Notably, educational policies have been extensively evaluated and would benefit from incorporating socio-economic evaluations.
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Future Directions: France Stratégie emphasizes the need for a methodological guide to develop standardised valuation methods for socio-economic calculations, particularly in fields like employment, health, and education.
In summary, while there are structural obstacles to applying socio-economic calculations to social investments, they offer significant potential benefits in terms of more efficient evaluation processes and policy adaptability. Overcoming current estimation challenges requires innovative research methodologies.
