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OECD Economic Surveys: Denmark 2005

image of OECD Economic Surveys: Denmark 2005

The 2005 OECD Economic Survey of Denmark, which has the most equal income distribution among OECD countries and has among the highest incomes, focuses on sustaining growth and preserving the welfare system in the face of a rapidly ageing population. In particular, it examines governmental reforms to foster fiscal sustainability and labour reforms to boost the labor supply. It also examines how improving competition could boost growth and how improving the educational system could raise productivity.

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Boosting Labour Supply

This chapter discusses how to increase labour supply, in terms of both hours of work and employment. The impact of high income taxes on working hours is discussed, and it is recommended that the top marginal tax rate be cut (as part of a revenueneutral package). The parental leave scheme is one of the world’s most generous, and also contributes to low average working hours. Sickness absences can also...

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