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Laboratory Federalism: The Open Method of Coordination (OMC) as an Evolutionary Learning Process
Author(s) -
ANIA ANA B.,
WAGENER ANDREAS
Publication year - 2014
Publication title -
journal of public economic theory
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.809
H-Index - 32
eISSN - 1467-9779
pISSN - 1097-3923
DOI - 10.1111/jpet.12079
Subject(s) - coordination game , redistribution (election) , nash equilibrium , best response , economics , simple (philosophy) , evolutionary dynamics , federalism , process (computing) , microeconomics , corporate governance , welfare , mathematical economics , computer science , political science , sociology , law , market economy , population , philosophy , demography , epistemology , finance , politics , operating system
In view of the concept of laboratory federalism, the Open Method of Coordination (OMC), adopted by the EU as a mode of governance, can be interpreted as an imitative learning dynamics of the type considered in evolutionary game theory. Its iterative design and focus on good practice are captured by the behavioral rule “imitate the best.” In a redistribution game with utilitarian governments and mobile welfare recipients, we compare the outcomes of imitative behavior (long‐run evolutionary equilibria) and decentralized best‐response behavior (Nash equilibria). The learning dynamics leads to coordination on a strict subset of Nash equilibria, favoring policy choices that can be sustained by a simple majority of Member States.