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CBA in decision-making processes of EU-27

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Abstract

This working paper investigates the role of CBA in the decision-making process of EU-27 member states. While the role of CBA at the EU decision-making level is well known and analysed, there is a gap in the analysis of the practices of the different member states in the use of this appraisal tool. The study is based on a survey sent to EU-27 country experts from public sector, private sector and academia. It investigates various aspects related to CBA, such as the legal requirements behind it, its preparation stage, the roles and responsibilities of the actors performing the study and its overall impact on the decision-making process. The analysis of the institutional framework governing CBA is fundamental because it influences the way it is conducted, its reliability and potential to improve the decision-making processes. The survey responses show the significant role of CBA within the EU-27. In most countries, there is a legal requirement to conduct CBA, and it is typically conducted at the pre-feasibility stage when project alternatives are still under consideration. All EU-27 countries dispose of guidelines to conduct CBA, and most of the countries’ experts reported an impact of CBA on the efficiency and effectiveness of projects under assessment. The results also reveal that EU-27 countries lack a consistent institutional framework for determining who conducts CBA, posing a risk of varying study quality. Additionally, they reported not regularly conducting ex-post CBA, representing a missed opportunity for policy learning purposes

Suggested Citation

  • Massimo Florio & Raffaele Articolo, 2023. "CBA in decision-making processes of EU-27," Working Papers 202301, CSIL Centre for Industrial Studies.
  • Handle: RePEc:mst:wpaper:202301
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    File URL: https://www.csilmilano.com/docs/WP2023_01.pdf
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    More about this item

    Keywords

    Cost-Benefit Analysis; legal requirements; preparation stage; Social Discount Rate; project appraisal; capital expenditures; decision-making processes;
    All these keywords.

    JEL classification:

    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis

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