The Cost of Single Market Fragmentation
What We Know, What We Don’t, and What We Need to Measure
European Policy Innovation Council | July 2026
Europe has measured the value of the Single Market it has built—and what it would lose by dismantling it. But what would Europe gain by completing it?
In 1988, the Cecchini Report helped make the economic case for the Single Market by measuring the costs of leaving national barriers in place. Today, Europe needs that clarity again. The remaining obstacles are less visible than border checks, but they continue to constrain competition, investment and the ability of European firms to scale.
This EPIC report reviews the evidence on Single Market fragmentation, distinguishes established findings from incomplete estimates, and proposes a new Cecchini-style research exercise to measure the benefits of completion. It is a literature review and a proposal for coordinated research—not a new econometric calculation.
What we know: the Single Market delivers substantial value
The economic value of the existing Single Market is well documented. Studies reviewed in the report estimate average annual welfare gains of around €840 per EU citizen and suggest that EU GDP would be around 8–9% lower without Single Market integration.
These findings demonstrate the scale of the asset Europe has created. But measuring what the Single Market already delivers, or what Europe would lose by reversing integration, does not tell us what removing the remaining barriers would achieve. The value of the existing Single Market and the benefits of completing it are different questions.
What we don’t know: the full benefits of completion
Existing completion-oriented studies point to substantial untapped gains. Institutional benchmarks suggest benefits around 4–5% of EU GDP, with broader estimates reaching 5–9%. These figures should be understood as orders of magnitude drawn from different studies, not as one definitive calculation.
The evidence remains fragmented across sectors, methods and assumptions. Some studies measure GDP or welfare; others measure trade flows, consumer savings or administrative costs. Their results overlap and cannot simply be added together.
The report identifies a central gap: Europe lacks a single, model-consistent, economy-wide assessment of the benefits of completing the Single Market from today’s baseline.
What we need to measure: a new Cecchini-style report
EPIC calls for a research steering group to coordinate a modern assessment of The Benefits of Completing the Single Market. Combining barrier studies, business evidence, sectoral analysis and economic modelling, the exercise would examine the remaining obstacles across services, goods, public procurement, energy, digital markets, capital, territorial supply constraints and administrative practices.
Its purpose would be to produce a credible range of potential gains, transparent assumptions, comparable sectoral estimates and evidence on who benefits—not another dashboard or an unexplained headline number.
The political argument is equally important. Completing the Single Market is a collective-action problem: national governments face immediate incentives to preserve domestic protections, while the benefits of removing them are often dispersed across borders and realised over time. Making those gains visible can strengthen the case for cooperation.
The Letta Report provides the strategic agenda. A new Cecchini-style report should provide the quantified economic case. Europe needs to know not only what completing the Single Market requires, but what completing it is worth.
