The Open Method of Coordination (OMC) as an Evolutionary Learning Process
41 Pages Posted: 14 Apr 2009
Date Written: April 2009
We 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 fields, 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 governments and mobile welfare beneficiaries, we compare the outcomes of imitative behavior (long-run evolutionary equilibrium), decentralized best-response behaviour (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.
Keywords: Open Method of Coordination, Finite-population Evolutionarily Stable Strategy, imitation, mobility, redistribution
JEL Classification: H77, H75, C73
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