This note presents the Roads EconomicDecision Model (RED) that performs an economic evaluation ofroad investments, and maintenance options, customized to thecharacteristics of low-volume roads, such as: highuncertainty of the assessment of traffic, road condition,and future maintenance of unpaved roads; periods with passdisruptions; levels of service, and corresponding road usercosts defined not only through roughness; high potential toinfluence economic development; and, beneficiaries, otherthan motorized road users. The model computes benefitsaccruing to normal, generated, and diverted traffic, as afunction of a reduction in vehicle operating, and timecosts, and, adopts the consumer surplus approach, whichmeasures the benefits of road users, and consumers ofreduced transport costs. RED addresses, among others, thefollowing additional concerns: reduce input requirements forlow-volume roads; consider the higher uncertainty, relatedto input requirements; compute internally the trafficgenerated due to decreased transport costs, based on adefined price elasticity of demand; and, quantify theeconomic costs, associated with the days per year when thepassage of vehicles is further disrupted by a highlydeteriorated road condition. Particularly, the modelhighlights all input assumptions, and comprehensivelyintegrates them with sensitivity, switching values, andstochastic risk analysis.
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