ABSTRACT
Economic analysis of natural resource development projects in third world countries is difficult. Estimates of the environmental impacts of such projects are imprecise. In addition, placing economic values on those impacts is not easy due to limited knowledge of the interactions between natural and social systems. In addition to reviewing the issues that arise when undertaking a benefit-cost analysis of a natural resource development project, Douglas Southgate and Frederick Hitzhusen stress the need to consider the full range of market and institutional forces influencing natural resource use when evaluating a specific project.
