The social purpose of new governance: Lisbon and the limits to legitimacy

This article examines the extent to which the Lisbon strategy, with its utilisation of the Open Method of Coordination (OMC) as the ‘new mode of governance’ for supranational social policy, has delivered on the pledge of acting as a counterweight to neoliberal market integration in the EU. Adopting a critical political economy perspective, we transcend the focus on institutional form of existing approaches, and seek to explain the social purpose of Lisbon. In this context we argue that both form and content of the Lisbon strategy reflect a hegemonic project of ‘embedded neoliberalism’, inasmuch as the Lisbon strategy's institutional mechanisms such as the OMC reaffirm the asymmetric nature of European governance through the promotion of market-making rather than market-correcting policies, bolstering the power of transnational capital while simultaneously incorporating subordinate projects through limited forms of embeddedness. The contradictions inherent in this strategy have come to test the limits of its legitimacy.