The Political Economy of Reform

Lessons from Pensions, Product Markets and Labour Markets in Ten OECD Countries

image of The Political Economy of Reform

This report examines why some policy reforms get implemented and others languish by examining 20 structural reform efforts in 10 OECD countries over the past two decades. The case studies cover a wide variety of reform attempts in three key areas: pensions, labour- and product-market regulation. Key factors in the political, economic and reform-specific arenas are identified as helping or hindering reform, and these findings are cross-checked using a relatively simple set of Spearman rank correlations. The report’s two-pronged analytical approach – quantitative and qualitative – results in unique insights for policy makers designing, adopting and implementing structural policy reforms.

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The Netherlands

Reform of disability insurance, 2002-06

The Netherlands’ disability insurance system has long been recognized as among the most generous in the world. A major reform of the system was agreed by the government and the social partners in the early 2000s and took effect on 1 January 2006. Among the factors that made disability insurance reform possible were: creation of a consensus on the need for reform, lessons learned from previous reform attempts, early reform measures that changed interest-groups’ incentives and government leadership.

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