OECD Productivity Working Papers

The OECD Productivity Papers are associated with the Global Forum on Productivity that provides a forum for mutual exchange of information and fosters international co-operation between public bodies with responsibility for promoting productivity-enhancing policies, including in undertaking joint policy analysis. It offers a platform for exchanging views, experiences and information, institutional and governance arrangements and government structures, with a view towards developing better policies. The Forum extends existing work in the OECD through a well-prioritised and coherent stream of analytical work serving the policy research needs of participants on the drivers of productivity growth.


The impact of structural reforms on productivity

The role of the distance to the technological frontier

In recent years, literature has linked structural reforms with productivity growth. Considering Portugal’s recent comprehensive reform agenda, this topic acquires particular relevance. Using data for Portuguese firms for the period 2006-2014, this paper assesses the impact of structural reforms on firms’ productivity. In line with existing literature, the analysis shows that most reforms entail long-term gains, despite, in some reform areas, the existence of short-term costs. In general, there are important differences across reform areas and across firms, namely when comparing firms with different productivity levels. The firms’ distance to the technological frontier mediates the impact of reforms, either by potentiating its effects or by curbing them, depending on the reform area.


Keywords: Structural reforms, Distance to frontier, Growth, Total Factor Productivity
JEL: D04: Microeconomics / General / Microeconomic Policy: Formulation, Implementation, and Evaluation; D22: Microeconomics / Production and Organizations / Firm Behavior: Empirical Analysis; O33: Economic Development, Innovation, Technological Change, and Growth / Innovation; Research and Development; Technological Change; Intellectual Property Rights / Technological Change: Choices and Consequences; Diffusion Processes; D24: Microeconomics / Production and Organizations / Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
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