OECD Economic Surveys: Norway

Every 18 months
1999-0383 (online)
1995-3321 (print)
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OECD’s periodic surveys of the Norwegian economy. Each edition surveys the major challenges faced by the country, evaluates the short-term outlook, and makes specific policy recommendations. Special chapters take a more detailed look at specific challenges. Extensive statistical information is included in charts and graphs.

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OECD Economic Surveys: Norway 2014

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05 Mar 2014
9789264219526 (EPUB) ; 9789264206786 (PDF) ;9789264206779(print)

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This 2014 OECD Economic Survey of Norway examines recent economic developements, policies and prospects. Special chapters cover real estate markets and financial risk and entrepreneurship.

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  • Basic statistics of Norway, 2012

    This Survey is published on the responsibility of the Economic and Development Review Committee (EDRC) of the OECD, which is charged with the examination of the economic situation of member countries.The economic situation and policies of Norway were reviewed by the Committee on 23 January 2014. The draft report was then revised in the light of the discussions and given final approval as the agreed report of the whole Committee on 7 February 2014.The Secretariat’s draft report was prepared for the Committee by Paul O’Brien and Yosuke Jin, with statistical assistance from Josette Rabesona, Valéry Dugain and Hermes Morgavi under the supervision of Patrick Lenain.The previous Survey of Norway was issued in February 2012.Information about the latest as well as previous Surveys and more information about how Surveys are prepared is available at www.oecd.org/eco/surveys.

  • Executive summary

    Norway’s new government has taken over responsibility for a prosperous, well-managed economy, where people are generally happy – indicators of both material and non-material welfare are at high levels. Intelligent use of wealth from petroleum resources and active use of monetary policy within the flexible inflation-targeting framework have insulated Norway from the worst of the financial crisis-induced recession and supported the recovery. There are challenges in a number of areas, which are taken up in this Survey.

  • Assessment and recommendations

    Norway’s economy has continued to prosper with continued growth in average incomes, low inequality, low unemployment and low inflation. Petroleum wealth has contributed to high incomes and supported the non-petroleum (mainland) economy; around 8% of mainland production is estimated to be directed towards supplying the offshore sector. At the same time, the prudent policy of saving almost all of net profits from petroleum as public sector assets has mitigated the impact of terms of trade fluctuations while building up a substantial stock of financial assets held in the Government Pension Fund Global. The value of this fund was about 200% of mainland GDP, some USD 800 billion, by the end of 2013.

  • Follow-up to previous OECD policy recommendations

    This annex reviews recent action taken on recommendations from previous Surveys. Recommendations that are new in this Survey are listed in the relevant chapter. An indication of the first year in which recommendations appeared is given in parentheses (except that we have not tracked back before 2005).

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  • Expand / Collapse Hide / Show all Abstracts Thematic chapters

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    • The financial system and real estate: Strengthening resilience

      In Norway house prices have risen to high levels, associated with very strong credit growth, in a context of low interest rates. Such a combination was in many countries a contributory factor to the 2008-09 crisis. The Norwegian authorities have been well aware of the problem. Below-target inflation and low interest rates abroad have kept policy interest rates low. Macro-prudential tools have been developed as additional policy instruments with a view to strengthen the banking system’s resilience to possible shocks and dampen systemic risk. This chapter notes that although the authorities seem to have succeeded in containing over-heating pressures in the housing market, high levels of household indebtedness persist, a phenomenon which was an important factor in the last major Norwegian recession. The chapter also provides some longer run considerations on resource allocation in the housing market.

    • Entrepreneurship

      Innovation is often, and correctly, thought of as the source of productivity growth and thus of increases in material well-being. But innovation does not occur in a vacuum, it occurs in firms and organisations that bring together resources – people, knowledge, physical and financial capital – to undertake projects with uncertain outcomes. The people that bring together these resources, and take risks in doing so, are entrepreneurs, though not all of them successfully innovate. This chapter notes that entrepreneurship is useful in the private and public sectors and in both small and large firms, new and old. With its wealth, generous welfare system and even income distribution, Norway might not be a fertile ground for entrepreneurial risk taking. Indeed self-employment and new firm creation are relatively low in Norway, although the survival rate of start-ups is higher than in many countries. Policy in Norway avoids pursuing too specific industrial or employment targets. It mostly refrains from protecting uncompetitive industries, with the notable exception of agriculture. And judging by continuing productivity growth and fairly healthy rates of firm creation, outcomes are satisfactory, even though some countries appear to do better. Best practices for policy are often not clear, but policy can move incrementally towards improvement in the education and research systems, as well as re-evaluating the role of competition policy and public ownership.

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