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2005 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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Ensuring Fiscal Sustainability

This chapter discusses the outlook for public finances given the pressures that are due to come from an ageing population. It compares the expenditure projections made by the government and the Welfare Commission (Velfærdskommissionen), and their varying assumptions on longevity and age-related health-care costs. Despite differences, the studies suggest that the current welfare system is not sustainable. Also discussed are the appropriateness of the government’s mediumterm fiscal framework (the 2010 Plan) and the need for extra efforts to boost labour...

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