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Promoting Potential Growth: The Role of Structural Reform

Author

Listed:
  • Luiz de Mello

    (OECD)

  • Pier Carlo Padoan

    (OECD)

Abstract

The global crisis has left many G20 countries with an unenviable legacy of lower potential output and high government indebtedness. Global imbalances, which had narrowed during the recession, are now beginning to widen again, as the recovery takes hold. Structural reform will be needed not only to recover the crisis-driven output loss and to maintain it in the longer term, but also to put the public finances back on a sustainable path and to rebalance global growth. To contribute to the policy debate, this paper summarises the analysis carried out by the OECD on the effects of a host of structural reforms on GDP growth, public finances and external current account balances. Promouvoir la croissance potentielle : Le rôle des réformes structurelles La crise mondiale a légué à de nombreux pays du G20 une production potentielle plus faible et un endettement public plus important. Les déséquilibres de la balance courante, qui avaient diminué pendant la récession, recommencent désormais à augmenter au fur et à mesure que la reprise prend forme. Des réformes structurelles seront nécessaires non seulement pour récupérer la perte de production potentielle due à la crise et la maintenir à plus long terme, mais aussi pour remettre les finances publiques sur une trajectoire soutenable et rééquilibrer la croissance mondiale. Ce document contribue au débat de politique économique en résumant l'analyse effectuée par l'OCDE sur les effets des réformes structurelles sur la croissance du PIB, les finances publiques et les déséquilibres de la balance courante.

Suggested Citation

  • Luiz de Mello & Pier Carlo Padoan, 2010. "Promoting Potential Growth: The Role of Structural Reform," OECD Economics Department Working Papers 793, OECD Publishing.
  • Handle: RePEc:oec:ecoaaa:793-en
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    File URL: http://dx.doi.org/10.1787/5kmbm6rz4dg6-en
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    Cited by:

    1. Romain Bouis & Romain Duval, 2011. "Raising Potential Growth After the Crisis: A Quantitative Assessment of the Potential Gains from Various Structural Reforms in the OECD Area and Beyond," OECD Economics Department Working Papers 835, OECD Publishing.
    2. Luiz de Mello & Pier Carlo Padoan & Linda Rousová, 2012. "Are Global Imbalances Sustainable? Shedding Further Light on the Causes of Current Account Reversals," Review of International Economics, Wiley Blackwell, vol. 20(3), pages 489-516, August.

    More about this item

    Keywords

    déséquilibres globaux; global imbalances; potential output; produit potentiel; réforme structurelle; structural reforms;

    JEL classification:

    • F30 - International Economics - - International Finance - - - General
    • J8 - Labor and Demographic Economics - - Labor Standards
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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