Cost-Benefit Analysis: An application to the analysis of wages in the Colombian oil sector

By means of the financial and economic evaluation methodology, this work evaluates the impact of the derogation of the derogation of the 284/57 Act in the Colombian oil sector on the social and individual welfare. From the financial view point, a loss could be expected if the derogation is performed instantaneously and without being part of a more general public policy. From the economic evaluation perspective, the welfare loss could be even worse because of the existence of high shadow prices and the inefficiency to increase profits due to growing income taxes, investments and employment.