Measuring Benefits from Inland Waterway Navigation Improvements

Historically, there has been considerable debate over appropriate methods for determining optimum investment in inland waterway navigation. Recent controversy has centered on a U.S. Army Corps of Engineers' study into the need for additional lock capacity at selected Upper Mississippi and Illinois Waterway locks. In this paper, we illustrate the use of spatial grain models (quadratic programming models) for estimating benefits from inland waterway navigation improvements. The illustrated methodology would appear to circumvent some of the recent criticism directed at the U.S. Army Corps of Engineers' study.