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2006 OECD Economic Surveys: Netherlands 2006

image of OECD Economic Surveys: Netherlands 2006

This 2005 OECD Economic Survey of the Dutch economy (published as the second issue in the 2006 volume) examines key economic challenges including putting public finances on a sustainable path, increasing resiliency in labour markets, strengthening product market competition, and improving the environment for innovation. As always, it assesses short-term prospects and provides a series of policy recommendations.

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Challenges Faced by the Dutch Economy

The Dutch economy is finally recovering, after having stagnated since the start of the decade. This first part of this chapter analyses the forces that are driving the present recovery, notably the progress made towards correcting the imbalances that caused the stagnation. It then discusses, based on detailed empirical evidence, why it took longer to return to trend growth in the Netherlands than in some other OECD countries – in other words, why the Dutch economy lacks resilience. The second part of this chapter gives an overview of medium-term challenges that will become increasingly important in the future: how to make the path of public finances sustainable in a context of population ageing; how to better utilise potential labour resources; how to boost productivity growth, in particular in the services sectors; and how to stimulate innovation activity so as to boost potential output growth.

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