The development of the petroleum industry and public spending made possible by oil revenues contributed strongly to the rapid growth in the Norwegian economy in the last three decades. But well-functioning institutions seem at least as important to Norway’s performance. Liberalisation of a regulated economy, appropriate specialisation, traditional openness to trade, early adoption and diffusion of high technology despite apparently low innovation, and a good macroeconomic stabilisation framework may also explain this success. Norway’s supply structure has now made it a chief beneficiary of globalisation. Rapidly emerging countries like China are supplying Norway with low-cost consumer goods while raising world prices for Norway’s oil and commodity based products. Moreover, competitive forces in Norway have been strengthened by rising inflows of foreign goods, capital and workers.