1887

OECD Economics Department Working Papers

Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.

The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.

English, French

Structural Reforms and the Benefits of the Enlarged EU Internal Market

Much Achieved and Much to Do

High expectations surrounded the two waves of eastward EU enlargement in 2004 and 2007, with the extension of the EU Internal Market being expected to deliver a substantial boost to economic growth in new and old member States alike. Indeed, considerable progress has been made, with existing evidence pointing to increased trade and FDI flows, enhanced east-west migration and a more stable macroeconomic environment. However, completion of the internal market is progressing at an uneven pace, and comparatively less progress can be seen in services industries, which provide over two-thirds of jobs and value added in the economy. Empirical estimates suggest that competition and trade-enhancing reforms in services industries could generate substantial productivity improvements across EU member economies. Over a period of 10 years, the predicted increase in labour productivity resulting from a bold reform package is around 10% for the average EU country, and new member States stand to gain even more. In addition to service-sector reform, priorities towards a more integrated EU internal market should include removing remaining barriers to labour mobility, improving transport infrastructure, mutual recognition of qualifications, and enhanced market integration of network industries. Finally, a more explicit use of benchmarking may help to enhance the momentum of future internal market reforms.

English

Keywords: regulation, integration, productivity, economic growth, structural reforms
JEL: L11: Industrial Organization / Market Structure, Firm Strategy, and Market Performance / Production, Pricing, and Market Structure; Size Distribution of Firms; D24: Microeconomics / Production and Organizations / Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity; F15: International Economics / Trade / Economic Integration; K23: Law and Economics / Regulation and Business Law / Regulated Industries and Administrative Law; L51: Industrial Organization / Regulation and Industrial Policy / Economics of Regulation; E23: Macroeconomics and Monetary Economics / Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy / Macroeconomics: Production
This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error