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Widespread supply disruptions in the wake of the COVID-19 pandemic and the Russian Federation’s large-scale aggression against Ukraine have raised concerns among policy makers that globalised value chains expose domestic production to shocks from abroad. This paper uses new indicators of global value chain dependencies and exogenous pandemic shocks to econometrically estimate the effects of supply disruptions abroad on domestic output. The results suggest that the adverse effects of supply disruptions are particularly large when concentration of supplying countries and supplying firms is high. Counterfactual simulations of the econometric model suggest that diversification of suppliers would have sizeable benefits in terms of shielding domestic production against country-specific supply shocks, with partial onshoring of production having only small additional benefits. Technological innovation that reduces foreign dependencies, such as the substitution of renewable energies for fossil fuels, can have similar benefits as diversification.

As its workforce ages and major economies shift towards producing higher value-added goods and services, New Zealand will face increasing challenges to remain globally competitive and maintain high living standards. Future growth will need to come increasingly from productivity gains, and resources will have to shift towards activities that rely more on skills, technology and intangible assets. Strengthening international linkages will be crucial to overcoming geographic disadvantages and will require improvements in the information and communications technology infrastructure, together with innovation leveraged off the country’s strong primary industry knowledge base. Continuing to raise skill levels and the pensionable age will also help counter the effects of ageing. Lifting national saving, partly by targeting a higher public saving rate, will reduce the persistently high relative real interest rates and the sustained overvaluation of the real exchange rate, which potentially harm economic activity. To improve the sustainability of growth, revenues from non-renewable resource extraction need to be invested for the benefit of future generations and greater efforts devoted to mitigate the damage to natural capital from economic activity, particularly with respect to water quality. This Working Paper relates to the 2013 OECD Economic Review of New Zealand (www.oecd.org/eco/surveys/New Zealand).

While teachers’ initial education is key to ensuring that new teachers are prepared for their work, it is only one piece in the continuum of teachers’ professional growth. Continuing professional learning is vital for teachers to broaden and deepen their knowledge, keep up with new research, tools and practices and respond to their students’ changing needs. It also plays a key role in building collaborative school cultures and supporting the collective improvement of the teaching profession. While the importance of continuing teacher learning is widely recognised, building efficient, equitable and sustainable professional learning systems is far from trivial. The OECD Teachers’ Professional Learning (TPL) study seeks to support the development of effective TPL policies and practices in schools and school systems. This paper proposes a theoretical and analytical framework for the study, systematically maps available OECD indicators to this framework and identifies information gaps and areas for future comparative work.

Total fertility rates at, or below, replacement level characterise today 64 countries with populations totalling 44% of that of the world. Many of these countries have total fertility rates below 1.5 and some have recorded belowreplacement fertility rates for decades.

French

Four decades of rapid economic expansion in China has generated enormous pressure on the environment, natural resources and public health. Alarming smog outbreaks during the 2010-13 period prompted the government to introduce a number of reforms to control air pollution, including a re-organisation of environmental institutions, improving the coordination and integrity of enforcement actions across levels of government, and the rolling out of a permit system for all stationary pollution sources. This paper reviews these recent developments, and discusses key remaining challenges. The paper complements two case studies on air quality policies in Korea and Japan, and a third case study on international regulatory cooperation on air quality in North America, Europe and North-East Asia.

The pollution intensity of the Japanese economy, measured as emissions per dollar of GDP, is among the lowest within OECD countries. However, air pollution remains a significant issue. Almost 80% of the Japanese residents were exposed to an annual concentration of PM2.5 above the WHO guideline while the attainment rate of the domestic air quality standard for photochemical oxidants is below 1%. The analysis of the regulatory and enforcement framework for air quality management in Japan identifies best practises and key remaining challenges, including a limited understanding of the generation mechanism of ozone pollution and the need to strengthen cooperation among Prefectures. This paper complements two case studies on air quality policies in China and Korea, and a third case study on international regulatory cooperation on air quality in North America, Europe and North-East Asia.

During past years, Korea figured among the OECD countries with the highest share of population exposed to excessive PM2.5 (atmospheric particulate matter that have a diameter of less than 2.5 micrometres) concentrations and PM2.5 concentration level in Seoul is about two times higher than the WHO’s guidelines or the levels of other major cities in developed countries. A number of countermeasures have been recently introduced to address such challenges, including a tightening of air quality standards and increasing local inspection and enforcement capacity. This paper reviews these recent reforms, and discusses possible further improvements. This paper complements two case studies on air quality policies in China and Japan, and a third case study on international regulatory co-operation on air quality in North America, Europe and North-East Asia.

The public pension system of Japan provides coverage for all, irrespective of occupation and income. Corporate pension plans provide additional benefits over the public pension in order to meet the diversified financial needs in retirement and play a key role in enriching people‘s life after retirement. The majority of corporate pensions in Japan are defined-benefit type. Consequently, a great amount of attention is paid to benefit rights. Nevertheless, in order to avoid the discontinuation of pension plans due to over-emphasis on benefit rights, Japan introduced a measure under the stagnant economy during the 1990s allowing pension plans to reduce accrued benefits under certain strict conditions, only when the government acknowledges that the sponsoring company will go bankrupt if employers are forced to continue to contribute to the pension plans to the same extent. At the same time, Japan introduced another measure allowing pension plans to use smoothing for valuing its assets in order to avoid temporary market fluctuations. As a result, corporate pension plans in Japan became manageable from a long-term perspective and able to adopt a flexible plan design whilst still ensuring benefit rights.

This policy brief examines the phenomenon of home-based entrepreneurship. It provides information on the types of businesses that entrepreneurs are most likely to operate out of the home, their reasons for this choice, and barriers to the development of home-based businesses. It examines how public policy approaches can better support home-based businesses, including removing hindrances in regulations and improving access to business development services. Key policy lessons are highlighted, including on how policy makers can increase social and labour market inclusion through taking better account of home-based businesses. This policy brief is part of a series of reports produced by the OECD on inclusive entrepreneurship. The series includes policy briefs on women’s entrepreneurship, youth entrepreneurship, senior entrepreneurship, access to business start-up finance for inclusive entrepreneurship and entrepreneurship by the disabled, as a well as reports on ‘The Missing Entrepreneurs’.

This policy brief on women in entrepreneurship was produced by the OECD and the European Commission. It explores the gender gap in entrepreneurship, the differences between male- and female-owned businesses, and the unique challenges that female entrepreneurs face when it comes to starting a business. Policy makers can support female entrepreneurs by promoting a positive attitude and female role models, offering training courses and mentoring, facilitating access to finance, and ensuring that their policies help women to participate in the labour market.

This policy brief is part of a series of documents produced by the OECD and the European Commission on inclusive entrepreneurship. The series includes policy briefs on youth entrepreneurship, senior entrepreneurship, social entrepreneurship, evaluation of inclusive entrepreneurship programmes, access to business start-up finance for inclusive entrepreneurship and entrepreneurship by the disabled as a well as a report on ‘The Missing Entrepreneurs’. All these documents are available in English, French and German. They are available at http://www.oecd.org/cfe/leed/inclusive-entrepreneurship.htm.

Norwegian policy gives high priority to supporting rural communities, with support for agriculture receiving particular attention. It is broadly successful in terms of maintaining rural communities, and urban-rural gaps in a range of well-being indicators are comparatively narrow. However, the cost-efficiency and sustainability of the policy mechanisms are questionable. Agriculture and rural policy in Norway needs to focus more strongly on economic sustainability alongside social sustainability. Agricultural support remains overly concentrated on maintaining the status quo and has seen little reform compared with policies elsewhere in the OECD. In contrast, the fishing industry has reformed much further towards economic sustainability, aquaculture has seen considerable success and there is potential for more rural tourism. Supporting rural communities also requires attention to the quality of public services in rural areas, and this report draws particular attention to inefficiencies arising from small-scale municipalities, and supports efforts to encourage mergers towards larger units, paving the way for greater operational leeway for municipal government.This working paper relates to the 2016 OECD Economic Survey of Norway (www.oecd.org/eco/surveys/economic-survey-norway.htm).
This paper identifies and analyses some key challenges that OECD and partner economies may face over the coming 50 years if underlying global trends relating to growth, trade, inequality and environmental pressures prevail. For example, global growth is likely to slow and become increasingly dependent on knowledge and technology, while the economic costs of environmental damages will mount. The rising economic importance of knowledge will tend to raise returns to skills, likely leading to further increases in earning inequalities within countries. While increases in pre-tax earnings do not automatically transform into rising income inequality, the ability of governments to cushion this impact may be limited, as rising trade integration and consequent rising mobility of tax bases combined with substantial fiscal pressures may hamper such efforts. The paper discusses to what extent national structural policies can address these and other interlinked challenges, but also points to the growing need for international coordination and cooperation to deal with these issues over the coming 50 years.
OECD countries face at least five major challenges for promoting policies that are consistent with their development goals: . ensuring security and political stability; . anticipating the impacts of their macroeconomic policies on developing-country growth; . increasing both market access and capacity building for developing economies; . supporting governance structures that help maintain financial stability; . improving aid effectiveness.
French
Increasing the flow of foreign direct investment (FDI) to developing countries is a cornerstone of new international development commitments. Accordingly, this paper reviews the state of knowledge regarding i) the factors that lead firms to build a plant overseas and ii) the influence that other policies (notably foreign aid) might have on those decisions. There are two broad motives for FDI: a “horizontal” motivation (to gain access to markets in the recipient country) and a “vertical” one (to exploit differences in production costs at various points in the production process). The clear message of the empirical literature (much of it focused on FDI flows between rich countries) is that market access is quantitatively far more important than production costs. What are the lessons for policy coherence? Positive effects of FDI on growth depend on a country’s absorptive capacity; aid can be used to promote human-capital accumulation while trade policies can facilitate the export orientation of the host economy. Both of these actions increase the likelihood of reaping rewards from FDI inflows. In particular, aid policies can aim at improving a recipient country’s communication infrastructure and institutional capacity. These policies attract FDI in turn, as they lower production costs and improve the prospects for productivity gains. Finally, trade facilitation between poor countries (to enlarge the market access represented by a given FDI destination) and temporary non-reciprocal market access improvements granted by rich countries could help attract FDI.
The East Asian development experience is still not well understood – especially the region’s clustered, sequential development process and neighbourhood effects linking economies at different levels of industrial development. Until now, the development impact of OECD-country policies had never been analysed systematically from this perspective. How have different policy vectors transmitted by OECD countries, notably in the areas of trade, investment and aid, contributed to the development of the region?
French
The past two decades have witnessed an active period of global reform with respect to policies concerning Intellectual Property Rights (IPRs). This paper examines – from an empirical, economic perspective – policies that complement the generally strengthened framework for IPRs in developing countries. The analytical approach involves three complementary levels of analysis: macro, micro and country case studies. Across all three approaches, the results point to a tendency for IPR reform to deliver positive economic results. Reforms concerning patent protection have tended to deliver the most substantial results, but the results for copyright reform and trademark reform were also positive and significant. Overall, the policy complements that were found to be most important in facilitating positive results were those related to inputs for innovative and productive processes and to the ability to conduct business. These include policies that influence the macro-environment for firms as well as the availability of resources (e.g. related to education), the legal and institutional conditions and the fiscal incentives.
Along many dimensions, China has made progress in strengthening the protection of intellectual property (IP) and expanding its research and development (R&D) base over the past two decades. Meanwhile, people’s understanding of IP has gone beyond a mechanical interpretation of patent law or copyright law. Instead, with years of experience in innovation, imitation and knowledge management, firms have begun to realize that IP protection is part of a complex business environment including various cultural, economic and strategic factors. This study takes a firm-level perspective and addresses two related topics. First, the paper examines the IP environment faced by various firms. In particular, the importance of IP protection and the strength of protective measures vary widely depending on the firms’ ownership structures and industry characteristics. Second, the paper analyzes firms’ strategic responses to the perceived IP environment. Firms not only adjust their R&D strategies, but also product and marketing strategies based on their assessment of the IP environment, which may have significant implications for China’s economic development in general. The paper concludes that momentum for IP reform is related to the economic potential in China. Such reform is an on-going system project involving not only patent, trademark and copyright laws, but also privatization policies, trade and FDI policies, as well as the role of the government in China’s innovation strategy.
Convergence is at present a key factor in developments underlying the electronic communications sector.1 The public can see, speak and listen using various media operating over all kinds of networks.
VoIP  applications  have  the  potential  to  reduce  prices  for  voice  communications  and  enhance competition in voice markets by lowering entry barriers to these markets.
In this paper we assess the determinants of secondary school outcomes in South Africa. We use Bayesian Averaging Model techniques to account for uncertainty in the set of underlying factors that are chosen among a very large pool of explanatory variables in order to minimize the risk of omitted variable bias. Our analysis indicates that the socioeconomic background of pupils, demographic characteristics such as population groups (Black and White) as well as geographical locations account for a significant variation in pupils’ achievement levels. We also find that the most robust policy determinants of pupils’ test scores are the availability of a library at school, the use of IT in the classroom as well as school climate. This Working Paper relates to the 2013 OECD Economic Survey of South Africa (http://www.oecd.org/eco/surveys/southafrica2013.htm).
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