OECD Economic Surveys: Switzerland

Every 18 months
1999-0464 (online)
1995-3402 (print)
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OECD’s periodic surveys of the Swiss 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: Switzerland 2015

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01 Dec 2015
9789264247062 (PDF) ; 9789264247321 (EPUB) ;9789264247048(print)

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This 2015 OECD Economic Survey of Switzerland examines recent economic developments, policies and prospects. The special chapters cover: Policies to tame the housing cycle and Raising public spending efficiency.

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  • Basic statistics of Switzerland, 2014

    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 Switzerland were reviewed by the Committee on 21 September 2015. 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 16 October 2015.The Secretariat’s draft report was prepared for the Committee by Petar Vujanovic and Richard Dutu under the supervision of Peter Jarrett. Secretarial assistance was provided by Dacil Kurzweg and Krystel Rakotoarisoa and statistical assistance by Patrizio Sicari.The previous Survey of Switzerland was issued in November 2013.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.

  • Abbreviations and acronyms
  • Executive summary

    OECD Economic Outlook 97 Database (and updates).

  • Assessment and recommendations

    Following a recession in 2009, economic growth in Switzerland bounced back strongly, outpacing its main European trading partners and matching the strength of the US recovery (, Panel A). As the recession hit, the Swiss National Bank (SNB) implemented an ultra-low interest rate policy and in 2011 enforced a ceiling on the franc versus the euro. The rebound in growth has been led primarily by exports, which recovered quickly after the 2009 recession (Panel B), and household consumption. Switzerland’s performance in terms of per capita GDP growth over the past decade has been near the OECD average, as has its labour productivity performance (Panel C).

  • Progress in structural reform

    Recommendations in previous Surveys

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  • Expand / Collapse Hide / Show all Abstracts Thematic chapters

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    • Policies to tame the housing cycle

      Since 2000, real estate prices in Switzerland have risen rapidly. By some measures, between 2000 and 2014 apartment prices almost doubled, while those of single-family homes increased by around 60%. Price rises have varied considerably across cantons. Transactions activity in the sector has been robust, with growth in mortgage volumes strongly outpacing disposable income. As a consequence, Switzerland’s residential mortgage debt-to-GDP ratio, at 120%, is the highest in the OECD. This is despite a private ownership rate of only around 40%, one of the lowest in the OECD. Banks’ exposure to the mortgage market is the sixth highest in the OECD, with mortgages making up over 80% of domestic (non-interbank) bank loans. That said, high house prices are being supported by very low interest rates, immigration-fuelled population growth and smaller family units, while demand is being bolstered by mortgage interest tax deductibility and institutional investors. Restrictive planning regulations have also damped the supply response. These factors have contributed to low rental yields, although high compared to other assets and very low vacancy rates. A number of measures have been taken by banks and authorities over the past three years to shore up banks’ exposure and to take the heat out of the market. These include a minimum down payment of 10% of the collateral value of the property from the borrower’s own funds, which may not be obtained by pledging or early withdrawal of second-pillar pension assets, and compulsory amortisation of loans. A counter-cyclical buffer (CCB) was activated at the beginning of 2013 and obliges banks to hold additional common equity Tier 1 capital based on their risk-weighted mortgage positions secured by residential real estate in Switzerland. In January 2014, the CCB was increased from 1% to 2%. Despite these measures, house prices remain high and the risk to the banking sector elevated.

    • Raising public spending efficiency

      Despite having low government spending, Switzerland scores highly in various public policy outcomes, including health, education and transportation. But, as the population grows and ages, efficiency of public spending will have to rise to maintain low tax rates. Given its high returns, the provision of early childhood education and care should be boosted, especially for children from disadvantaged socio-economic backgrounds, including those from immigrant families. Cantons should avoid oversupplying baccalaureates, thereby lowering university dropout rates. Policies will also need to adapt to structural changes in the labour market, byboosting the supply and attractiveness of fields of study that are facing high demand on the labour market, and by further clarifying study streams across tertiary education. Health-care efficiency could be raised by further developing managed-care networks. Enforcing systematic data collection for the quality of care would also help patients and providers make better informed choices. Generic drugs’ prices are too high due to a poorly designed price-fixing mechanism. Transportation suffers from congestion that could be reduced by implementing peak-load pricing on roads and trains. But efficiency in public spending is also about allocating public funds optimally. Switzerland’s rapidly rising social security entitlements and its fiscal equalisation system constrain public spending and risk crowding out important expenditures. Fast-rising social security entitlements could be addressed via indexing the retirement age to life expectancy. Fiscal equalisation weakens tax-raising incentives for some cantons; this could be addressed by allowing them to keep a larger part of their increased revenues. Efficiency in allocating public expenditure could also be raised by increasing the share of public spending allocated by tender and harmonising procurement regulations across all levels of government.

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