Water Resources Management

, Volume 11, Issue 4, pp 283-303

First online:

Estimating the Economic Costs of Hydrologic Data Collection

  • Todd GoninonAffiliated withDepartment of Civil and Environmental Engineering, University of Melbourne
  • , Paul PrettoAffiliated withDepartment of Civil and Environmental Engineering, University of Melbourne
  • , Geoff SmithAffiliated withHydrographic Services, Thiess Environmental Services
  • , Alan AtkinsAffiliated withFaculty of Architecture and Planning, University of Melbourne

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This paper examines the estimation of the economic costs of hydrologic data collection using the concept of opportunity cost. The opportunity cost of operating a hydrologic data collection network is equal to the maximum value the resources used in its operation would have if they were free to be used in another area. A method for estimating the opportunity cost of operating individual stations is developed in this paper. This method is then demonstrated using representative opportunity cost estimates for individual stations in a hypothetical network based on the Victorian hydrologic data collection network, Australia. An important distinction is made between financial costs and economic costs, particularly with respect to their relative suitabilities for use in different applications.

hydrologic data collection economic cost opportunity cost financial cost present value