Economic Impact Analysis on High-yield Groundwater Development R&D Project in Jeju

제주도 청정 대용량 지하수개발 연구사업의 경제적 효과분석

  • Ahn, Eun-Young (Korea Institute of Geoscience and Mineral Resources (KIGAM)) ;
  • Kim, Seong-Yong (Korea Institute of Geoscience and Mineral Resources (KIGAM))
  • Published : 2009.04.28

Abstract

For economic impact analysis on a R&D project of high-yield groundwater development in Jeju conducted by KIGAM from 2004 to 2007, benefit/cost ratio(BCR), net present value(NPV), and internal rate of return(IRR) were calculated by contingent valuation method(CVM), production function analysis, domestic water market analysis and technology factor analysis. Measurable direct impact parameters among the major outputs of this R&D project consisted the estimation 4 high-yield and high mineral groundwater reserve in Jeju. Annual use of the reserve by piped water and bottled water was estimated as 12.23 million ton and its monetary value was calculated as 293.4 million dollar in 2006 year value applied of 5.5% discount rate. Economic impact of this R&D project in NPV of year 2006, with applying a discount rate of 5.5%, was identified and estimated as 13.66 million dollar in NPV, 4.05 points in BCR, and 22.74% in IRR, respectively. Additional early launch benefit was 5.58 million dollar. Even increased of the 1% discount rate, NPV of this R&D project was also positive as 12.18 million dollar and BCR was 3.71.

Keywords

economic impact;BCR;NPV;IRR;benefit

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