Pro-Productivity Institutions: Learning from National Experience

This article analyses and compares ten institutions that have a mandate to promote productivity-enhancing reforms. The selected bodies include government advisory councils, standing inquiry bodies, and ad hoc task forces. We find that well-designed pro-productivity institutions can generally improve the quality of the policy process and political debate, and can make a significant contribution to evidence-based policy-making. Our findings also support the view that concentrating knowledge and research on productivity in one independent, highly skilled and reputed body can help create the momentum and the knowledge that are required to promote long-term productivity growth. Institutions located outside government have more leeway in promoting reforms that challenge vested interests and produce results that go beyond the electoral cycle. Smart government bodies can allow experimental policy-making and a more adaptive, evidence-based policy process. To be successful, pro-productivity institutions require sufficient resources, skills, transparency and procedural accountability to fulfil their tasks; a sufficiently broad mission, oriented towards long-term well-being and with both supply-side and demand-side considerations; policy evaluation functions; and the ability to reach out to the general public in a variety of ways