Economic Evaluation of Investment for Oceanographic Research by using Cost Benefit Analysis (A Case study of Iranian National Institute for Oceanography)

Abstract

This article presents an evaluation of Cost Benefit Analysis (CBA) from oceanographic research in Iranian
National Institute for Oceanography (INIO) as a case study over a 10-year period from 2002 to 2012. From three forms
of CBA, we have calculated Benefit-Cost Ratio (B/C ratio) for three categories of benefits depending on how the level of
confidence is. Annual adjusted benefit is based on value added by cost saving or avoided cost method. Adjusted costs are
the public funds which have been indicated to INIO each year. For those benefits that have direct economic effect, the
level of confidence is high and for indirect benefits that need more assumption to apply or more investment, confidence
level is medium and low. The results show that B/C ratio for oceanography research in Iran ranging from a low of 0.14
to a high of 4.77 depends on different scenario for benefits. So if a tangible monetary benefit is our case, the B/C ratio
shows that there is no economic efficiency and more investment is needed to make oceanographic studies applicable and
economical.