@article{Cernea:127327,
      recid = {127327},
      author = {Cernea, Michael and Kanbur, Ravi},
      title = {An Exchange on the Compensation Principle in Resettlement},
      address = {2012-07-11T18:32:34Z},
      number = {642-2016-44228},
      series = {WP},
      pages = {49},
      month = {Jul},
      year = {2012},
      abstract = {How does development economics address the issue of gains  and losses from the displacement that inevitably  accompanies many development processes? This paper argues  that economists have struggled mightily between the core  criterion of a “Pareto improvement”, which vests  individuals with infinite rights in their current standard  of living, and its deeply conservative implications—both  that it would prevent redistribution away from the rich,  and that it would stop most projects from ever taking  place. Where they have got to conceptually is a compromise,  through using distributionally sensitive weights to  evaluate the gains and losses of a project. In practice,  however, systematic use of such weights in project  appraisal or cost-benefit analysis is rare. Apart from  advocating such use, which is true to the spirit of the  conceptual position reached in economics, the paper argues  that specific compensation mechanisms and generalised  safety nets will reduce tensions between protecting the  vulnerable and supporting projects that produce aggregate  net benefits—including benefits for the vulnerable  themselves.},
      url = {http://ageconsearch.umn.edu/record/127327},
      doi = {https://doi.org/10.22004/ag.econ.127327},
}