1. Gareth D. Myles University of Exeter

2.  The book advances the theory of cost benefit in directions beneficial for EU policy  It builds on the best of current theory  The analysis is developed from a perspective that is informed by practice  These features make it a valuable contribution in the tradition of manuals on cost-benefit analysis

3.  Every government has limited resources to spend on public projects  This forces the selection of a limited set of projects  The correct choice will ensure the increase in welfare is maximised  This can only be achieved if the resources used are correctly valued

4.  Cost-benefit analysis was formalised in the 70s alongside the re-emergence of welfare economics  A definitive statement was provided in the Drèze and Stern survey  Their model could incorporate a range of policy variables (or signals) and side constraints  They emphasised the joint determination of shadow prices and optimal policies

5.  How can the book add to this literature?  The economic and political environment continues to evolve  The development of the EU has changed the institutional setting  New objectives have been set for policy  The modelling techniques used in economics have advanced

6.  The structure of the EU involves multi-level government  The objectives of the EU include income equality across regions  The Lisbon process has emphasised the importance of sustainable growth  And the internal structure of the policy problem has changed (budget set first then allocated)

7.  The book develops the theory to accommodate these developments  It develops policy analysis for the new ordering  The analysis explicitly models multi-level government  It also incorporates the political economy of policy choice  And acknowledges bargaining over policy

8.  The book successfully constructs an explicit model for median voter choice  This can be embedded within the cost- benefit model  It can also be linked to the central government concern for regional inequality  It also presents a insightful model of the bargaining problem between centre and region

9.  Like any good contribution the book opens avenues for future research  Three of these will be briefly discussed  First, the strategic relationship between regions and the centre  Second, the incorporation of cost-benefit analysis in models of economic growth  Third, the economic analysis of voting

10.  The book models regions as bargaining with centre  It also considers the allocation of a fixed level of expenditure  Regions could be represented as acting more strategically  This might be significant if the problem is expanded to raising revenue as well as allocating expenditure

11.  Expenditure will be made in the region where marginal benefit is highest  Revenue will be raised where marginal cost is lowest  This raises questions of political economy  Also conjecture that there could be an incentive for a region to deliberately choose a poor tax structure  Incentive compatibility becomes an issue

12.  The Drèze and Stern model is essentially static  There is a need to extend cost-benefit analysis to address issues of economic growth  This raises numerous questions about the modelling of growth paths  And the transition between balanced growth paths

13.  Economics lacks an adequate model of political processes  The median voter model only works in restricted circumstances  The analysis of voting faces a conflict between the implications of rationality and observed outcomes  This is a difficulty for all study of political economy

14.  Wish offer thanks for allowing me this opportunity to comment on this book  And provide congratulations for what has been achieved  The book will inform my own future work on these issues  I look forward to the future developments that are now possible