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Services employ an ever-increasing share of workers in all OECD countries. This trend is likely to continue as it reflects deep structural forces, such as increasing consumption of services with rising incomes and population ageing and the growing role of intangible assets. Services are very diverse, but overall tend to have weaker productivity levels and growth rates than manufacturing. As a result, the shift to services entails a moderate but persistent drag on productivity growth. Still, there are reasons to hope for a pick-up in service productivity in the future, including thanks to new technologies (e.g. digital platforms, artificial intelligence). This concerns both “knowledge intensive” services (e.g. information and communication) and less knowledge intensive ones (e.g. personal transport). Harnessing this productivity potential requires adjusting policies to foster innovation and efficient use of new technologies, enhance competitive forces by reducing information asymmetries, barriers to entry and switching costs, and increase the tradability of services within countries and across borders.

The increase of emerging market economies in international trade and rapid rise in global trade intensity over the past three decades has been accompanied by growing, regionally concentrated, discontent with trade in advanced OECD countries. One of the main concerns is the negative effects of growing import competition on employment. This paper focuses on manufacturing sector employment because of its high trade exposure and potential for wider spillovers. It finds that while trade appears to have only a minor association with manufacturing employment shares at the national level compared with technology, trade has an important role in regional labour market developments due to the geographical concentration of industrial activities. The "sticky" nature of manufacturing employment and sometimes inefficient inter-regional migration mean that trade shocks to local manufacturing can affect entire regional labour markets, leading to widening regional inequalities. Policies should, in particular, focus on boosting regional resilience to industry related shocks, whether they come from trade or technology by building local capacity, both in terms of people – more educated labour is more mobile across jobs – and innovation.

Productivity growth in Lithuania has slowed in the aftermath of the global financial crisis,

holding back income convergence and making it harder to reduce further the relatively high

inequality and poverty. A comprehensive approach is required to address productivity and

inclusiveness challenges, building on their synergies. The government has taken measures

to this end, with the New Social Model at the core, but efforts need to continue. Reforms

should focus on additional improvements in the business environment by easing further

regulations on the employment of non-EU workers and reducing informality. Initiatives to

improve the governance of state-owned enterprises are welcome and need to continue.

Improving access to finance and ensuring effective bankruptcy procedures are key to

boosting firm dynamism, as are measures to encourage business-research sector

collaboration on innovation. Addressing large skills mismatch is also a priority. Increasing

the market-relevance of the education system is important. More and better-quality jobs in

the formal sector, especially for the low-skilled, are key to inclusiveness and well-being,

while more effective support and active labour market programmes would help combating


This Working Paper relates to the 2018 OECD Economic Survey of Lithuania


The Working Paper summarises the main findings and recommendations of the pilot study, including first orders of magnitude of TOSSD flows to Nigeria. Estimated TOSSD flows to Nigeria in 2016 amounted to approximately USD 3 billion of official development finance and USD 1.9 billion of private finance mobilised through official development interventions. These first orders of magnitude have been estimated using OECD DAC Statistics. However, these figures are likely to be largely underestimated due to information gaps, notably on the People’s Republic of China (hereafter China) and emerging providers’ official support to Nigeria. The results of the pilot also indicate that the current organisational set up of Nigeria, both from an institutional and an IT system perspective, makes it challenging for the Government to access, collate, collect analyse and use data on external financing to the country using national data.

The TOSSD pilot in Nigeria confirmed the usefulness of country pilots for testing the TOSSD methodology and for ensuring feedback by partner countries on TOSSD as a measurement framework. The findings also helped to ascertain that the International TOSSD Task Force developing the framework is in the right direction with regard to the main parameters of the measure. Findings contained in the present Working Paper will support the discussions to refine the emerging TOSSD Reporting Instructions in 2018 and 2019.

The Dutch labour market has recovered and the unemployment rate has been converging towards pre-crisis levels. Non-standard forms of work have expanded with a strong trend towards self-employment and an increased reliance on temporary contracts. These developments may reflect a preference of some individuals for a more flexible working relationship, but they could also lower job security and job quality for others. Policies need to protect vulnerable groups in the more dynamic working environment without creating barriers to labour mobility and flexibility of the overall labour market. To improve the fairness of the tax system, policies should ensure a more level playing field between workers on different types of contracts. Regulatory policies should aim at raising labour market mobility to improve the matching of skills to jobs by easing the protection on permanent employment contracts and through a more targeted approach to activation policies for disadvantaged groups. Finally, measures should improve the skills of individuals in vulnerable groups to enhance their opportunities to find better jobs.

This Working Paper relates to the 2018 OECD Economic Survey of the Netherlands 2018

(www.oecd.org/eco/surveys/economic-survey-the netherlands.htm).

The Zambia country pilot study was conducted by the OECD Development Assistance Committee (DAC) to explore the challenges of transition finance for a commodity-based Least Developed Country (LDC). In particular, debt sustainability concerns are viewed within the context of the shifting financing for sustainable development landscape of Zambia following its re-classification to Lower Middle Income Category (LMIC).

In line with the Addis Ababa Action Agenda (AAAA), the pilot study proposes a new “ABC” approach targeted to assess all available sources of financing (official development finance, private investment, domestic resources, and remittances), identify emerging SDG financing gaps and promote better alignment of resources with national financing for sustainable development strategies.

Ces dix prochaines années, un pourcentage croissant de jeunes adultes devraient obtenir un diplôme de l’enseignement tertiaire, la Chine et l’Inde caracolant en tête – en particulier dans les domaines en plein essor et extrêmement porteurs des STIM. Cependant, si dans les pays de l’OCDE et du G20, le pourcentage de diplômés de l’enseignement tertiaire devrait augmenter davantage chez les femmes que chez les hommes, celles-ci pourraient néanmoins continuer de rester en retrait dans les domaines des STIM, où elles ont toujours été sous-représentées. Dans un avenir proche, le défi consistera à garantir que les systèmes d’éducation sont en mesure de délivrer des diplômes de l’enseignement tertiaire d’une qualité et d’une pertinence optimales, dans un souci constant d’équité et d’inclusivité.


This policy brief examines the phenomenon of home-based entrepreneurship. It provides information on the types of businesses that entrepreneurs are most likely to operate out of the home, their reasons for this choice, and barriers to the development of home-based businesses. It examines how public policy approaches can better support home-based businesses, including removing hindrances in regulations and improving access to business development services. Key policy lessons are highlighted, including on how policy makers can increase social and labour market inclusion through taking better account of home-based businesses. This policy brief is part of a series of reports produced by the OECD on inclusive entrepreneurship. The series includes policy briefs on women’s entrepreneurship, youth entrepreneurship, senior entrepreneurship, access to business start-up finance for inclusive entrepreneurship and entrepreneurship by the disabled, as a well as reports on ‘The Missing Entrepreneurs’.

Until recently a lack of data meant that little was known about the distribution of firms and firm dynamics in South Africa. A new firm-level panel dataset based on tax data creates opportunities to better understand how firms enter, grow and exit. By using the OECD’s DynEmp framework, which was designed to create harmonised variables based on confidential firm-level data, this paper provides new insights about the dynamics of firms in South Africa and how these compare to other countries. One concerning finding is that the entry rate of formal sector firms was probably below the exit rate in recent years, which means that firms are growing older. The relatively low start-up rate compared to other countries together with the higher average firm size of entrants are consistent with the low rates of entrepreneurial activity and the presence of barriers to firm entry highlighted in the existing literature on the South African economy. As in other countries, young firms have disproportionately contributed to employment growth and remained net job creators even as GDP growth slowed. Nonetheless, large firms are particularly prominent in the South African economy, including as net job creators.

The rapid integration of emerging market economies (EMEs) into world trade over the past three decades has raised widespread concerns about the effects this is having on trade-exposed sectors in advanced OECD countries. An analysis of international trade patterns of over 4000 products between 1995 and 2015 shows that the export product overlap between advanced OECD economies and EMEs has been increasing. However, the product overlap between advanced countries is still higher and increasing faster, suggesting that competitive pressures in export product markets on advanced economies is mainly coming from other OECD members. Regression analysis corroborates this finding, supporting the idea that competition from EMEs remains relatively moderate. Regression analysis show that a move to specialise in a product by the United States exerts about twice as much competitive pressure as a similar decision in China. However, competition effects on average are small compared to changes in world demand as drivers of country competitiveness at the individual product level. The negative effect of a one standard deviation decrease in world demand for a product exerts 8 times more pressure than a one standard deviation increase in specialisation of the United States for that product. In short, specialising in what the world wants to buy remains the key for export performance.

This paper examines whether immigration can operate as a counter-process of depopulation and economic recession. Based on the comparative analysis of four case studies in Belluno (Italy), Klagenfurt-Villach (Austria), Dalarna (Sweden), and Haßberge (Germany), it analyses the key socio-economic factors explaining the successful integration of migrants, refugees, status holders and asylum seekers and examines under which conditions the arrival of newcomers can turn into a local development opportunity for these territories. The case studies feature four remote territories with the following common characteristics: they have undergone significant socio-economic transformations over the past decade, they face a population decline with an alarming outmigration of youth combined with an increasing ageing population, and central governments have channelled recent immigration and asylum seekers to peripheral areas to counterbalance negative demographic trends. Results show that integration paths undertaken by recipients differ significantly across the four territories. However, all case studies suggest that stable jobs and accommodations render remote and mountain localities attractive for refugees and status holders, who are usually more inclined to move to urban centres. Lastly, results from the case studies highlight the importance of designing individualised integration paths backed by social inclusion initiatives that can incite spontaneous collaborations and work relations with local inhabitants.

Significant variation across and within OECD countries reflects the diverse roles that non-state actors can play in the reception and integration of asylum seekers. This variation can be explained by the differences in the organisation of welfare service delivery, the various national schemes supporting employment and the specific legal frameworks allowing for the labour market access of asylum seekers, along with the inclination of local inhabitants to self-organise to face new challenges. Within the wide spectrum of non-state actors that provide assistance to refugees and asylum seekers, this paper focuses specifically on third sector organisations. Through a survey, it assesses the contribution of these organisations during the refugee crisis in Europe, from 2014 to 2016, in delivering reception and integration policies for refugees, protection holders and asylum seekers and in experimenting with innovative approaches. The paper concludes with a number of policy recommendations on the ways governments leverage the innovative capacity of third sector organisations in providing meaningful and effective initiatives to integrate refugees in the society, labour market and economy of host communities.

La transition des études à la vie active peut être une étape difficile, parfois marquée par des périodes de chômage. Les données montrent que les jeunes qui quittent le système éducatif précocement ont un niveau de compétence et de formation comparativement faible, et rencontrent les plus grandes difficultés sur le marché du travail par rapport à leurs pairs restés scolarisés plus longtemps. Des efforts doivent être consentis afin de garantir une scolarisation pour tous au moins jusqu’à l’obtention d’un diplôme du deuxième cycle du secondaire – souvent considéré comme le seuil minimum à atteindre pour réussir son entrée sur le marché du travail. Rester scolarisé permet non seulement d’élever son niveau de formation, mais aussi de développer les compétences nécessaires à une transition réussie vers le marché du travail.


This paper, Tax policies for inclusive growth in a changing world, has been prepared in support of Argentina’s G20 Presidency. While this paper is focused on taxation policy, it forms part of a broader contribution that the OECD has made in support of Argentina’s G20 presidency.

Against a backdrop of increased inequality and persistently low productivity growth, this paper considers the challenges and opportunities confronting policy makers in a rapidly changing world as a result of globalisation, technological change and the changing world of work. The paper focusses on:

• The impact of the tax system on the market distribution of income, by supporting employment, skills investments, and labour market formality.

• How shifting tax mixes towards growth-friendly taxes can be combined with measures to improve progressivity, particularly through base-broadening and through removing inefficient and regressive tax expenditures.

• Ways in which personal income taxes and social transfers can foster inclusive growth by raising the efficiency and equity of labour and capital income tax systems.

• How tax policy can foster business dynamism and productivity, including through support for investment and innovation, and can raise efficiency by continuing to combat BEPS.

• How tax capacity can be raised, and how tax administration can be strengthened, including through international co-operation

The paper provides tax policy advice and recommendations to support governments in their pursuit of tax and transfer policies conducive to inclusive growth, while supporting innovation and increased productivity growth; preserving the revenue-raising capacity of the tax system; and ensuring the sustainability of public spending.

Adult migrants in all OECD countries are a diverse group, with different profiles and levels of education. Even if they hold tertiary degrees, they are more likely to have poorer labour market outcomes, including lower earnings. Participation in the labour market is more difficult for foreign-born

adults who arrived at a later age and acquired their qualifications in another country. It is important that host countries design and implement policies that will help immigrants improve their chances in their labour market, benefitting both the person and the country.

  • 17 Dec 2018
  • Boris Cournède, Jean-Marc Fournier, Peter Hoeller
  • Pages: 52

Il existe de nombreuses possibilités pour réformer la fiscalité et les dépenses publiques de manière à promouvoir davantage de croissance et d’inclusion sociale. En particulier, il est possible de mener des réformes qui améliorent l’activité économique tout en réduisant les écarts de revenu. D’autres ajustements de la structure des finances publiques vont produire des avantages pour une seule de ces deux dimensions. Enfin, certaines réformes appellent un compromis entre une amélioration du revenu moyen et des effets distributifs défavorables. Des analyses économétriques de l’expérience acquise par les pays de l’OCDE fournissent des résultats empiriques sur quelles sont les réformes de la fiscalité et des dépenses qui ont une influence significative sur la prospérité et la distribution des revenus – et de combien.


This paper investigates the effects of spending the European Regional Development Fund (ERDF) on productivity, employment and other performance indicators of Latvian firms. After controlling for the fact that more productive and larger firms are more likely to benefit from ERDF resources, we find that participation in projects co-financed by the ERDF increases firms’ employment, turnover and capital stock per employee immediately, while it raises their productivity only three years after the launch of such projects. Furthermore, participants that were initially less productive, larger, less capital intensive and more financially leveraged enjoy larger productivity gains. Also, financing capital investment through the ERDF does not result in any productivity gains compared to the case when it is financed through private funding. However, it results in a larger increase in employment, which is possibly partly due to the firm’s plan to increase employment being one of important criteria for selecting the ERDF beneficiaries.

This study explores feasibility of regional rice market integration by examining the impacts on production and trade, with a specific focus on the adjustment impacts for rice producers. It seeks to set out policy measures required to better integrate the rice markets of Association of Southeast Nations (ASEAN) countries and the role that trade policy can play to help the agricultural sector adjust to pressures created from freer trade in rice within this region. While regional rice market integration can deliver more rice at lower prices to the regions consumers, this study finds significant adjustments to the rice sectors will be required in Indonesia, Malaysia, and the Philippines. However, opportunities through lowering tariff barriers with existing key trading partners of free trade agreements has the scope to create more employment and value adding opportunities in all agricultural sectors to offset the losses from regional rice market integration. The study suggests a number of measures are necessary to build trust in regional markets to allow rice market integration to take place. This includes an agreement to ban export restrictions. Furthermore, while broader trade reforms will help create new opportunities for agricultural sectors across the ASEAN region, flanking policies and investments in the enabling environment are still required for the sectors to take full advantage of these opportunities.

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