Tag Archives: Real Interest Rate

Project Evaluation II: Thoughts about Interest Rates

Interest rates used in project evaluation should command the attention of anyone interested in water projects.  The lower (or higher) the interest rate used in project evaluation, the more (less) likely a given project will be judged economically viable.  The interest rate issue should NOT be viewed as an issue in the exclusive domain of economists and financiers.  Otherwise, project evaluation will be co-opted by “off-line” discussions among economists and financiers selecting the interest rate. Continue reading