Assessment Criteria for a Sustainability Impact Assessment in Europe

Public economics usually emphasizes the task of “setting the framework conditions” for markets. In formulating such setting, however, research has to deal with imperfect markets, uncertainties, and unknown impacts of any regulatory reform. Against this background, the EU undertakes efforts towards ‘regulatory impact assessment’ and ‘sustainability impact assessment’. The following article derives assessment criteria for any sustainability impact assessment from different strands of economics such as innovation research, new institutional economics and evolutionary economics. It starts from some observations on framing activities, stating that economic policy can be conceptualised as institutional reform rather than a one-off activity. It then elaborates several criteria. Beginning with the established notions of ‘relevance’, ‘effectiveness’, ‘efficiency’ and ‘adaptation flexibility’, the article introduces explicit sub-criteria and guiding questions for thorough analysis. Those eleven criteria are problem identification, decentral solutions & compensation, target setting, target’s implementation, cost reduction, positive side effects, negative side effects, freedom and flexibility, evaluation and review, participation und transparency, control. Some thoughts are made towards an application. The paper is geared towards impact assessments of cross-cutting approaches. The paper concludes with some remarks on the role of those within sustainability strategies. JEL Categories: B52, H11, H41