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2020 | OriginalPaper | Chapter

Jules Dupuit (1804–1866): Cost-Benefit Analysis and Collective Choices

Author : Philippe Poinsot

Published in: Great Minds in Regional Science

Publisher: Springer International Publishing

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Abstract

Cost-benefit analysis is today the subject of many criticisms and has been widely debated. Despite these concerns, it remains one of the main methods for the evaluation of public policies, in particular, in transport. This method is rooted in the debates on the measurement of public utility between the engineers of the Corps des Ponts et Chaussées in the nineteenth century and, in particular, within the work of Jules Dupuit. In this chapter, Philippe Poinsot traces Dupuit’s contribution to the measurement of public utility, placing his research in a broader perspective, and clarifying the relationships between public utility and another important concept for engineers known as “intérêt general.” This distinction is important to understand Dupuit’s position on many subjects related to economics and regional science.

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previous chapter Rolf Funck (1930–2015): Developing Regional Science in Europe

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In Dupuit’s work, “utilité publique” is different from the English expression “public utility.” The latter means an organization (company or administration) providing a public service, whereas “utilité publique” is a criterion to increase the wealth of society. In this chapter, I will use Dupuit’s concept.

The other well-known members of this tradition are Clément Colson, François Divisia, René Roy, Maurice Allais, and Marcel Boiteux.

The term “liberal” is used here in the French sense of the word, referring to the nineteenth-century economists who believed that free market conditions were more effective than state intervention in the economy.

The Chair in political economy at École des Ponts et Chaussées was established in 1847. Joseph Garnier was the first professor until his death in 1882. Henri Baudrillart was the second professor until 1892, followed by Clément Colson. On this point, see Etner (1986) and Le Van-Lemesle (2004, pp. 98–102).

See, for instance, Ekelund and Hébert (1999, 2003, 2012), Poinsot (2010, 2011, 2018b), Numa (2012, 2016, 2017), and Simonin and Vatin (2017).

Dupuit was not the first to have criticized this method to assess public utility. But he was the only critic to provide an alternative method. For more details on the methods for the evaluation of public policies before Dupuit, see Ekelund and Hébert (1999, pp. 65–90), Grall (2004, 2017), and Etner (1983, 1987).

For this interpretation, see, for instance, Currie et al. (1971), Daniel (1971), Ekelund (2008), Ekelund and Gramm (1970), Ekelund and Hébert (1999, 2002), Hausman (1981), Houghton (1958), Pfouts (1953), Stigler (1950), and Willig (1976).

However, one should note that Dupuit’s concept is different from Marshallian consumer’s surplus. While the latter refers to a surplus of satisfaction, Dupuit’s relative utility is a monetary surplus. For more details on this point, see Poinsot (2011).

For Dupuit, the demand for an infrastructure is a decreasing and convex function of the toll. For a discussion of this point, see, for instance, Béraud (2005), Ekelund and Hébert (1999), and Poinsot (2011).

For more details on Dupuit’s position on price discrimination, see Beard and Ekelund (1991), Diemer (2000), Ekelund (1970), and Ekelund and Hébert (1999, pp. 192–227).

For more details, see Etner (1987), Grall (2004, p. 31), Mosca (1998), and Smith (1990).

On this point, Dupuit criticizes the position on property rights taken by French liberals of his time, such as Bastiat, Molinari, and Garnier. He believed property rights are not a natural right and they should be allocated according to public utility. See Poinsot (2010, 2011), Sagot-Duvauroux (2017), Sigot (2010), and Vatin (2017).

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Title: Jules Dupuit (1804–1866): Cost-Benefit Analysis and Collective Choices
Author: Philippe Poinsot
Publisher: Springer International Publishing
Book: Great Minds in Regional Science
Print ISBN: 978-3-030-46156-0

Electronic ISBN: 978-3-030-46157-7

Copyright Year: 2020
DOI: https://doi.org/10.1007/978-3-030-46157-7_5

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