Published in February 2019, Department for Transport’s ‘Squaring the circle – Reconciling the GDP and welfare impacts of transport interventions’ is intended to assist policymakers and scheme promoters with the economic appraisal of transport interventions by showing how to reconcile the GDP and welfare impacts of transport interventions. ‘GDP’ captures the value of traded goods and services and is a market-based measure of economic wellbeing. The term ‘welfare’ refers to the level of prosperity and standard of living of either an individual or a group of persons.

Given that GDP and welfare are so frequently used when considering the impact of transport interventions, this Report highlights the main ways in which a transport intervention can affect these measures differently – and when a difference (or what is referred to as ‘wedge’) between the two measures occur. The Report also outlines other important considerations, including regional characteristics.