Quantitative methods for the economic appraisal of a new technology: a critical review

Summary form only given. In the light of considerations of quantitative methods for the analysis of technological innovation, the paper presents a critical review of the most prominent evaluation techniques aiming to assess their strengths and weaknesses when applied in the appraisal of new technologies. The result of the study is summarized in two tables. In the first, the surveyed techniques are compared along seven dimensions that outline the resource and data needs; the constraints that influence the resulting outcomes; how risk and uncertainty are dealt; the main advantages and weaknesses; and the kind of problem that are best fitted by a given method. In the second, the operational usefulness (a mix of ease of use, transparency and unambiguousness) of the various methods is evaluated. In conclusion, the study underlines that: (a) the efficacy of each method does not univocally stand on its analytical sophistication, but rather on how the nature of decision the problem fits the theoretical and practical features of the evaluation technique; and (b) the recent tendency towards a combining use of different approaches seems to be a promising way to overcome the pitfalls of the single method