33 Journal of Bhutan Studies, Vol.47, Winter 2022 Benefit-Cost Ratio of an investment in an innovation A benefit-cost ratio indicates the return per dollar invested: where Nit is the number of people reached by challenge solution i in year t, Bit is the estimated benefits per person reached (net of operation costs – the recurrent spending and capital investment that are required to make the soluti. [...] Mathematically, it is the rate SRORi that equalizes the two sides of the equation below, setting the value of discounted costs equal to the value of discount benefits: 34 Benefit-Cost Analysis of the Fab Bhutan Challenge An investment is deemed socially beneficially if its social rate of return is greater than some threshold. [...] Extension to a portfolio of innovations To calculate the return of FBC, the returns on the individual challenges must be summed and set against the innovation costs of not only the individual challenge solutions, but the FBC as a whole. [...] The microdata of the 2022 Labor 35 Journal of Bhutan Studies, Vol.47, Winter 2022 Force Survey (LFS) was used to calculate the size and status quo income of the occupational and geographic groups that would benefit from the solutions. [...] Sustaining high growth will require revitalizing the agriculture sector (which has seen falling yields for the past decade), rejuvenating of the industrial sector (which has been sluggish since a strong manufacturing decade in the 2000s), propping up the services sector (which has struggled since the onset of the COVID-19 pandemic), and preparing Bhutan’s young workforce for employment in the grow.
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- Published in
- Bhutan
