This paper develops a novel approach to the economic evaluation of public policies: participatory value evaluation (PVE). PVE involves citizens directly in decisions of the government, taking into account governmental and individual budget constraints. Citizens receive reliable information on social impacts and can choose the best portfolio of projects according to their social preferences. This paper develops the economic and econometric theoretical framework for fixed budget and flexible budget PVE experiments which allows us to directly measure the change in social welfare for investments in water infrastructure in The Netherlands.
Dekker, T., Koster, P., & Mouter, N. (2019). The economics of participatory value evaluation. Tinbergen Institute Discussion Paper 2019-008/VIII