ABSTRACT
Resolving a complex policy problem often requires a mix of policy instruments and thus the identification of the most promising instrument combination. This chapter defines the terminology necessary for detecting three different possible policy instrument interactions – namely, synergistic, counterproductive, and additive effects. It identifies two approaches to analyzing instrument mix effects: the “effect-based” and the “effort-based” methods. The chapter discusses the practical advantages and limitations of each approach and elaborates on key methodological issues that policy scholars and practitioners face at each step of developing a new policy mix. The application of mixes of policy instruments may also produce lower responses. Policy instrument and policy design scholars are consequently interested in the interaction effects when combining a policy instrument with other instrument in a policy mix.
