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Regulation and Economic Performance: Product Market Reforms and Productivity in the OECD


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  • Giuseppe Nicoletti
  • Stefano Scarpetta


This paper assesses the implications of past and ongoing reforms in OECD product markets for the labour productivity gap, a key component of cross-country differences in GDP per capita. After a brief review of the theoretical literature, we bring together the results obtained in some of our empirical work over the past few years, discussing econometric approaches and their drawbacks. We then use these results to gauge the likely effect of further reforms. We distinguish effects on capital deepening and technical progress by examining the impact of regulations on investment (domestic and foreign) and multi-factor productivity. We focus on the effects of policies aimed at strengthening private governance (e.g. through privatization) and opening up access to markets where competition is economically viable. The results suggest that pro-competitive reforms tend to increase both investment and multifactor productivity and, through both these channels, they can lead to higher growth in GDP per capita. Ce papier analyse les implications des réformes dans les marchés des biens de la zone OCDE pour un des facteurs qui expliquent les différences internationales dans le PIB par tête : les écarts dans la productivité du travail. Après avoir examiné brièvement la littérature théorique, nous résumons les résultats de quelques unes des études empiriques que nous avons réalisées aux cours des dernières années, tout en discutant les approches économétriques utilisées et leurs limites. Nous utilisons ensuite ces résultats pour évaluer les effets qui pourraient être observés si les réformes étaient poussées plus loin à l’avenir. Nous distinguons les effets des réformes sur l’accroissement de l’intensité en capital et sur le progrès technique en nous appuyant sur trois études qui analysent l’impact de la régulation anti-concurrentielle sur l’investissement (national et de l’étranger) et la productivité multifactorielle. Nous nous concentrons sur les implications quantitatives au niveau macroéconomique des politiques visant à renforcer la gouvernance des entreprises (par exemple par la privatisation) et à éliminer les barrières réglementaires à l’accès dans les marchés où la concurrence est soutenable. Cet examen porte à conclure que les réformes qui accroissent les pressions concurrentielles sur les marchés des biens tendent à augmenter à la fois l’investissement et la productivité multifactorielle. Par ce biais, les réformes peuvent mener à une croissance plus soutenue du PIB par tête dans les pays qui les réalisent.

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Bibliographic Info

Paper provided by OECD Publishing in its series OECD Economics Department Working Papers with number 460.

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Date of creation: 22 Nov 2005
Date of revision:
Handle: RePEc:oec:ecoaaa:460-en

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Keywords: panel data; aggregate productivity and growth; investment; regulation; investissement; productivité et croissance; données de panel; régulation;

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