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2002 OECD Economic Outlook, Volume 2002 Issue 2

image of OECD Economic Outlook, Volume 2002 Issue 2

Twice a year, the OECD Economic Outlook analyses the major trends that will mark the next two years. The present issue covers the outlook to the end of 2004 and examines the economic policies required to foster high and sustainable growth in member countries. Developments in selected major non-OECD economies are also evaluated in detail.

In addition to the themes featured regularly, this issue contains four analytical chapters addressing the following important questions: the deterioration in budgetary positions in most OECD countries, raising the labour force participation of older workers,  the benefits that OECD countries could achieve from undertaking reforms to promote product market competition, and inflation rates in some of the larger, slow-growing economies have not declined sufficiently to offset higher rates elsewhere in the euro area.

English French, German

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Australia

The economy continued to perform strongly in the first half of 2002, as buoyant domestic demand more than offset the weakness of exports. With monetary conditions remaining supportive and the global environment expected to improve, economic growth is projected to remain robust, despite the current farm drought and a likely downturn in the residential property sector. The labour market may improve further, while the combination of wage moderation and sizeable productivity gains will help keep labour costs and inflation under control.

The favourable economic outlook should permit a more neutral setting of monetary and fiscal policies, to lock in price stability and ensure budget balance over the economic cycle. Further decentralisation of wage bargaining should help to lower the still high structural unemployment, while reform of the income support system should aim at strengthening the incentives of welfare recipients to participate in gainful employment.

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