Market Mechanisms for Policy Decisions
AbstractThe thesis of this Paper is that more transparent, rule-bound and subtle mechanisms for policy coordination will be needed to ensure the success of an enlarged European Union. A common policy is a public good with distributional implications. Economists have developed a large number of plausible market mechanisms for the efficient provision of public goods, and the European Union, with its limited number of members and relative ease of information is a promising ground for such schemes. An important open area of applied research is thus the tailoring of incentive schemes to the specific needs of the European Union and its policy choices. The Paper discusses two possible examples: a system of tradable deficit permits to implement the fiscal constraints imposed by the Maastricht treaty; and a rule allowing country representatives to shift their own votes intertemporally when deliberations are taken by vote in periodic committee meetings.
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Bibliographic InfoPaper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 2667.
Date of creation: Jan 2001
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Find related papers by JEL classification:
- F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
- P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
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- Moore, John & Repullo, Rafael, 1988. "Subgame Perfect Implementation," Econometrica, Econometric Society, vol. 56(5), pages 1191-1220, September.
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