When a policy or measure is described as “effective,” it can sometimes mean that it achieves the desired goal. However, it can also refer to “cost-effectiveness,” meaning that a certain goal—such as a reduction in emissions—is reached at the lowest possible cost. In any case, it is important to assess the indirect effects that the policy will have. For example, if a product is taxed, the primary purpose might be to reduce the consumption of that specific product. This could lead to the development of alternative products, representing an indirect technological development.
The time aspect is also crucial. A policy measure that is not cost-effective today could become so in the future if new, cheaper technologies are developed. Economic instruments like taxes are cost-effective if they can target emissions, although sometimes this can be technically challenging. On the other hand, prohibitions can be clear and effective. Combinations of policy tools can also be effective and may lead to increased acceptance.
Often, the necessary preconditions or availability of alternatives must be in place. For instance, it is easier to encourage people to switch to cycling if it is perceived as safe and time-efficient (as seen in Copenhagen). It is less effective to implement policies that reduce car traffic if there are no bike lanes or good public transportation options.
About author:
Göran Finnveden
Program Director and Professor in Environmental Strategic Analysis at the Department of Sustainable Development, Environmental Sciences and Engineering (SEED), KTH, Stockholm
My research is focused on sustainable consumption, circular economy and methods for environmental and sustainability assessments of different types of products and systems. In the program I am the director and also leading a project on sustainable consumption and macro-economic effects.
