Learning from Decentralised Policy: The Demand Side

Jan Schnellenbach

No 05-001, JEPS Working Papers from JEPS

Abstract: A popular argument about economic policy under uncertainty states that decentralisation offers the possibility to learn from local or regional policy experiments. We argue that such learning processes are not trivial and do not occur frictionlessly: Voters have an inherent tendency to retain a given stock of policy-related knowledge which was costly to accumulate, so that yardstick competition is improbable to function well particularly for complex issues if representatives' actions are tightly controlled by the electorate. Decentralisation provides improved learning processes compared to unitary systems, but the results we can expect are far from the ideal mechanisms of producing and utilising knowledge often described in the literature.This paper looks at competition in the telecommunication industry.

Keywords: Policy decentralisation; fiscal competition; model uncertainty; collective learning (search for similar items in EconPapers)
JEL-codes: D83 H73 O31 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2005-06
New Economics Papers: this item is included in nep-pbe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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