Cost-Effectiveness Analysis in Development: Accounting for Local Costs and Noisy Impacts

Integrating Value for Money and Impact Evaluations: Issues, Institutions, and Opportunities

“…Even if coordination of methodological standards was resolved, challenges to external validity remain. As pointed out by Evans and Popova (2016), program Costs differ greatly across contexts even for the same type of intervention. These Cost differences naturally result in large variations in efficiency estimates.…”

“…These Cost differences naturally result in large variations in efficiency estimates. Uncertainty in effect estimates, recall bias in expenditures, and scale can substantially influence cost-effectiveness estimates (Evans and Popova 2016). Even so, transparency in Cost reporting and assumptions can improve crosscontext comparisons and usefully quantify the nature of the variation in implementation costs.…”

“…Impact evaluators frequently face a lack of cost data and lack of standards for performing analyses. Moreover, some economists-the discipline that churns out most of the IE work in international development-relate that Cost analysis does not "feel like" microeconomics, and together with a lack of training in Cost analysis methods and the challenge of getting it right even if the data are available, make the cost of doing the analysis greater than the benefit-from the researcher's perspective (Evans, 2016). Together, these factors conspire to expose researchers to risk of costly critique from peer reviewers-convincing many to avoid the exercise altogether.…”

“…When cost data are not explicitly available, they are estimated-sometimes borrowing from other studies-but more frequently without meaningful details of how Costs were estimated. Such ex post data collection is prone to recall bias and underestimating expenditures (Evans and Popova 2016). About two-fifths of the World Bank's impact evaluations do not indicate which cost elements are included in the analysis.…”

Can Solar Lanterns Improve Youth Academic Performance? Experimental Evidence from Bangladesh

“…To further assess the estimates, we carried out a cost-effectiveness analysis, following the method used by and Evans and Popova (2016) (see Section S.1 in the supplemental appendix for the details). To simplify the analysis, we considered only the cost (prices) of the solar lanterns, ignoring other factors such as research administration costs, reduced kerosene expenditure, and product maintenance opportunity costs.…”