DIGEST 2006 - Sabita

oads. These considerations
influence the optimal upgrading
quotient in opposite directions, but
there is no reason to suppose that
they neatly cancel each other out.)
of economic analysis. Let us now
consider the shadow-priced
benefits of road surfacing that
should also be factored into
evaluation.
In any case, this conservative
conclusion arises only prior to
considering other relevant benefits
of paved surfaces and costs of
gravel ones. Before we turn to the
domains where shadow pricing is
concerned, one direct financial
cost factor, which can’t yet be
quantified because it is speculative
but will turn up on public books as
a market price rather than a
shadow price, must be taken into
account. This is that new gravel is
becoming scarce in SA, so its price
is sure to rise.
Municipalities are no
longer allowed to
open new pits without
performing
environmental impact
assessments, which
are beyond the
resource capacity of
most rural
authorities. In
addition, in many
in stances in south ern
Af rica, op ti mal
materials for gravel
roads are con cen trated un der
ar a ble land that has higher
opportunity value as farmland
than as gravel. Thus, on the ba sis
of con struc tion and main te nance
costs alone, we should ex pect the
thresh old for sur fac ing, what ever
ad di tional con sid er ations we use
to determine it, to drop in SA.
However, as noted, accounting for
these costs is only the beginning
Municipalities
are no longer
allowed to open
new pits without
performing
environmental
impact
assessments
• Because of the dust they
spread onto crops, wildlife
and people, gravel roads
impose heavier
environmental costs than
surfaced ones. Dust causes
allergies and respiratory
illness, especially in small
children. People must clean
their homes, businesses and
vehicles more often in dusty
conditions, and this is not a
cost that should be ignored
simply because it is not borne
by the state. It
is, after all, still
borne by the
country on the
dimension that
ultimately
counts for
most, viz.,
reduced
productivity.
Even seemingly
trivial expenses
can produce
high overall
costs when
multiplied by
enough people and hours in
calculating aggregate shadow
prices. To my knowledge, no
one has ever tried to
estimate the costs of road
dust in any jurisdiction. The
task would be quite
demanding. It is surely worth
doing, however, because the
resulting magnitude might be
surprising to many, and thus
might in turn help people not
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