One of the most important capacities of a market regulator is the ability to assess the market impacts of a regulation before it is adopted. Regulatory impact analysis (RIA) is a tool now used in most developed countries to improve understanding of the impacts of a law and other forms of regulation on business costs and opportunities. RIA also improves the transparency of decisions, and enhances consultation and participation of affected groups.

Jacobs and Associates offers unique experience with assisting governments in setting up regulatory impact analysis programs. We have assisted governments in the methods, processes, theory and practice of regulatory impact analysis, public consultation, and building skills among government officials implementing RIA. Scott Jacobs, Managing Director, and Rex Deighton-Smith, Associate, are the same team that developed the best practices for regulatory impact analysis at the OECD that continue to be used as international benchmarks in this area. Randall Lutter, Associate, was a Senior Economist for the environment and regulation in the US President's Council of Economic Advisers, where he chaired an interagency group on methods of analyzing costs and benefits of federal regulations. He has helped write the guidance to U.S. Federal agencies on how to conduct benefit-cost analysis.

We have advised most of the OECD countries in setting up their RIA programs in the past several years. Our staff has published extensively on regulatory impact analysis from comparative and national perspectives.

As Jacobs and Deighton-Smith wrote in the 1997 book, Regulatory Impact Analysis: Best Practices in OECD Countries, “RIA attempts to widen and clarify the relevant factors for decision making. It implicitly broadens the mission of regulators from highly focussed problem solving to balanced decisions that trade off problems against wider economic and distributional goals. Far from being a technocratic tool that can be simply "added on" to the decision making system by policy directive, it is a method for transforming the view of what is appropriate action, indeed, what is the proper role of the state.” (This book can be purchased from the OECD’s online bookshop at www.oecd.org).

Implementation of regulatory impact analysis is not only a technical issue of the right methodologies. Design of an appropriate RIA process that integrates regulatory and sustainable impact analyses also requires broad knowledge of government procedures and values, of policy priorities, of transparency tools, and of the consequences of regulatory choices in dynamic and global economies. Moreover, adaptation of impact analysis to the unique institutions in any country and the formidable challenges faced by domestic regulators requires familiarity with the richness of practices in various institutional settings.

Our recent RIA work includes: