Praising Their Own Wine? EU Legislators and Non-Falsifiable Statements in Impact Assessment

23 Pages Posted: 21 Sep 2012 Last revised: 23 Sep 2012

See all articles by Giacomo Luchetta

Giacomo Luchetta

LUISS School of Government

Sven Hoeppner

Ghent University-Universiteit Gent

Date Written: September 20, 2012

Abstract

Impact Assessment is nowadays a stable element of the EU policymaking landscape and its importance in the legislative process is still growing. It is supposed to disclose information and by doing so to help governing the principal-agent relationship between the legislators and the drafting entity. Nevertheless, a large part of its informational content consists of non-falsifiable statements whose verification is almost impossible given the lack of meaningful counterfactuals. While it is rational for the agent to express non-falsifiable statements in a world of informational asymmetry with a lack of credible sanctions, the willingness of the principals to accept these statements seems prima facie questionable. This paper explores this subject through the lenses of economic analysis, including principal-agent and game theoretic reasoning, to understand whether agents’ behavior is sensible and the reasons behind it. Moreover, we consider phenomena revealed by behavioral economics to check whether they better explain the observed reliance on non-falsifiable statements.

Keywords: EU policymaking, impact assessment, non-falsifiability, principal- agent theory, behavioral economics

Suggested Citation

Luchetta, Giacomo and Hoeppner, Sven, Praising Their Own Wine? EU Legislators and Non-Falsifiable Statements in Impact Assessment (September 20, 2012). Available at SSRN: https://ssrn.com/abstract=2149424 or http://dx.doi.org/10.2139/ssrn.2149424

Giacomo Luchetta

LUISS School of Government ( email )

Viale Romania 32
Rome, 00197
Italy

Sven Hoeppner (Contact Author)

Ghent University-Universiteit Gent ( email )

Coupure Links 653
Gent, 9000
Belgium

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