The Open Method of Coordination (OMC)
AbstractWe interpret the Open Method of Coordination (OMC), recently adopted by the EU as a mode of governance in the area of social policy and other ¯elds, as an imitative learning dynamics of the type considered in evolutionary game theory. The best-practise feature and the iterative design of the OMC correspond to the behavioral rule \imitate the best." In a redistribution game with utilitarian gov- ernments and mobile welfare bene¯ciaries, we compare the outcomes of imitative behavior (long-run evolutionary equilibrium), decentralized best-response behavior (Nash equilibrium), and coordinated policies. The main result is that the OMC allows policy coordination on a strict subset of the set of Nash equilibria, favoring in particular coordination on intermediate values of the policy instrument.
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Bibliographic InfoPaper provided by University of Vienna, Department of Economics in its series Vienna Economics Papers with number 0904.
Date of creation: Mar 2009
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Find related papers by JEL classification:
- H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
- H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
- C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
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