Public sector
Additionality
The part of an outcome that would not have happened without the program or investment.
Facts checked against sources onWhat does Additionality mean?
Additionality is the difference between what happens with an intervention and what would have happened anyway (the counterfactual). It is central to judging public spending, grants, development finance and carbon credits. The UK Treasury's Green Book, its guidance on appraisal, asks officials to adjust for effects such as deadweight (what would have happened anyway) and displacement (gains that simply move from somewhere else). Example: a subsidy helps 1,000 firms hire, but 600 would have hired anyway (deadweight) and 100 only took workers from other local firms (displacement), so the additional effect is 300 firms, and the true cost per result is more than three times what the headline suggests.
Where does it come up in case interview prep?
Related terms
- Logic modelA chain from inputs to activities, outputs, outcomes and impact that shows how a program is meant to work.
- Opportunity costThe value of the best option you give up.
- Public-private partnership (PPP)A long-term contract in which a private company builds, finances or runs public infrastructure or services.
- Availability paymentA regular payment from government to a PPP partner for keeping an asset open and up to standard.
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