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Regulation, Productivity and Growth: OECD Evidence

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  • Giuseppe Nicoletti
  • Stefano Scarpetta

Abstract

In this paper, we relate the scope and depth of regulatory reforms to growth outcomes in OECD countries. By means of a new set of quantitative indicators of regulation, we show that the cross-country variation of regulatory settings has increased in recent years, despite extensive liberalisation and privatisation in the OECD area. We then look at the regulation-growth linkage using data that cover a large set of manufacturing and service industries over the past two decades. We focus on multifactor productivity (MFP), which plays a crucial role in GDP growth and accounts for a significant share of its cross-country variance. We find evidence that reforms promoting private governance and competition (where these are viable) tend to boost productivity. Both privatisation and entry liberalisation are estimated to have a positive impact on productivity. In manufacturing the gains are greater the further a given country is from the technology leader, suggesting that regulation limiting ... Régulation, productivité et croissance dans les pays de l'OCDE Cette étude essaye de mettre en relation les résultats de croissance dans les pays OCDE avec l'étendue et la profondité des réformes affectant le degré de concurrence sur les marchés des biens. A l'aide de nouveaux indicateurs quantitatifs de régulation, nous montrons qu'en dépit de la libéralisation des marchés et des privatisations d'entreprises publiques réalisées dans la zone OCDE, les différences dans les environnements réglementaires se sont récemment accrues. Nous utilisons ensuite des données qui couvrent de nombreuses industries de biens manufacturés et de services au cours des deux dernières décennies pour explorer le lien entre la régulation et la croissance. L'analyse se concentre sur la productivité globale des facteurs (MFP), qui joue un rôle central pour la croissance du PIB et explique une part importante de sa variabilité en coupe pays. Nous trouvons que les réformes encourageant la gouvernance privée des entreprises et la concurrence ...

Suggested Citation

  • Giuseppe Nicoletti & Stefano Scarpetta, 2003. "Regulation, Productivity and Growth: OECD Evidence," OECD Economics Department Working Papers 347, OECD Publishing.
    • Handle: RePEc:oec:ecoaaa:347-en
    DOI: 10.1787/078677503357
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    More about this item

    Keywords

    croissance; growth; models with panel data; modèle avec données de panel; privatisation; privatisation; productivity; productivité; regulation; régulation;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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