THE INTEGRATION OF EQUITY AND EFFICIENCY CRITERIA IN PUBLIC PROJECT SELECTION.

This paper reports on the formulation and implementation of explicit formulae for consolidation of equity and efficiency criteria in the selection of regional development projects in the United States. The programmes we concern ourselves with are "area specific" or "region specific" Federal grants, such that choosing one project over another bears resemblance to choosing one area over another. In effect, therefore, this note is concerned with the construction and application of Bergsonian-type welfare functions in an operational context. This paper discusses and illustrates our treatment of these issues on an experimental basis for the United States Economic Development Administration, an agency which makes grants-in-aid (and loans) to economically depressed localities in the United States. The primary legal criteria for being "depressed" in this case are that a locality (usually a United States county) has an unemployment rate greater than 6% or has a (1959) median family income which is 50% of the national median or less. [ABSTRACT FROM AUTHOR]