The Handbook on Economic Analysis of Investment Operations provides a comprehensive framework for evaluating development projects using economic analysis. It aims to help analysts determine whether proposed investments improve national welfare by comparing project costs and benefits from the perspective of society rather than only the implementing agency. The handbook integrates financial, economic, and fiscal analysis to assess impacts on governments, beneficiaries, and broader stakeholders. It explains core concepts such as opportunity cost, shadow pricing, and the distinction between financial and economic prices. The guidance emphasizes identifying project alternatives, using with- and without-project comparisons, and properly valuing environmental and social impacts. It also introduces techniques for risk and sensitivity analysis. Widely used in development finance institutions, the handbook supports transparent, evidence-based decision-making in public investment planning across sectors such as transport, energy, health, and education.
