Where is economy headed 2011

Under shock: How to spread macroeconomic risks more fairly. An Overview of Going for Growth Priorites in Country Notes Structural policy indicators Housing and the economy: policies for renovation Tackling current account imbalances: is there a role for structural policies? A new look at OECD health care systems: typology, efficiency and policies.

Going for Growth: Responding to the Going for Growth Policy Priorities: an Overview of Progress Country Notes Explaining differences in hours worked across OECD countries The scope to enhance efficiency in primary and secondary education Policies to enhance investment in higher education Economic geography and GDP per capita International trade in services and domestic regulation.

Structural policy priorities: overview Country Notes Structural policy indicators The employment effects of policies and institutions Product market regulation and productivity convergence Policies to strengthen competition in product markets What shapes the implementation of structural reform? Progress in Responding to the Policy Priorities: Overview Country Notes Encouraging Innovation Regulation of financial systems and economic growth Alternative measures of well-being.

Structural policy priorities Structural policy indicators Country Notes Product market regulation in OECD countries: to The retirement effects of old-age pension and early retirement schemes in OECD countries Female labour force participation: past trends and main determinants in OECD countries Long-term budgetary implications of tax-favoured retirement saving plans. Editorial and Executive Summary The COVID pandemic is exposing long-standing structural weaknesses in our economies and widening gaps in living standards among countries, regions and people.

How can structural policies boost growth, enhance resilience and inclusiveness, and improve environmental sustainability? What are the priorities for international co-operation? What are the most frequent policy priorities?

Watch the launch and expert webinars Going for Growth: Watch the launch. Going for Growth in Central Europe. Going for Growth in Australia and New Zealand. Under shock: How to spread macroeconomic risks more fairly Going for Growth An Overview of Going for Growth Priorites in Country Notes Structural policy indicators Housing and the economy: policies for renovation Tackling current account imbalances: is there a role for structural policies?

First, the powerful growth momentum in emerging markets appears likely to continue. Second, strong profit performance and balance sheets in the nonfinancial corporate sector in the advanced countries argue against a renewed sharp retrenchment so soon after a major downturn.

The caveat is that precisely such a shock may be brewing in the form of a sovereign debt crisis in Italy and Spain, so containing the problem there is the single most important condition for a continued global recovery beyond its current soft patch.

No smoking gun is responsible for the recent global slowdown. The vulnerability of advanced countries to shocks in the wake of the Great Recession, beginning with the sorry state of their public finances, is clearly part of the story. Large parts of the private sector are still struggling to regain their footing—the housing industry is chronically depressed, especially in the United States, and the health of European banks is highly suspect.

Such growth-dampening features are common in the wake of large financial crises and persist for many years. But two other features that predate the Great Recession are also responsible for the quagmire in advanced countries. Second, the eurozone is in the throes of a sovereign debt crisis, which is directly linked to its inadequately designed monetary union.

Against this background of acute vulnerability has come a cyclical and policy correction following the sharp global recovery between early and early Powered mainly by developing countries, global growth peaked at an unsustainable 5.

At the same time, advanced countries under fiscal pressure cut back their stimulus programs. Altogether, fiscal stimulus withdrawal is projected to reduce demand in the G20 countries by 1 percent in To complete the picture, four very recent shocks contributed to the confidence crisis.

Cumulatively, these factors—acute vulnerability, cyclical and policy corrections, and extraneous shocks—account for the recent cyclical slowdown. But are they enough to cause another global recession? No accepted definition exists of a global recession. We define it here as a one-year decline in global per capita GDP at market exchange rates. However, such an outcome, which would be consistent with sharply rising unemployment and falling commodity prices, is unlikely, for three major reasons.

There is little sign that the underlying drivers of growth in developing countries—technology adoption, urbanization, structural transformation, and investment—are about to slow.

Indeed, despite the financial crisis, GDP in emerging markets has already surpassed its pre-crisis trend. Moreover, most of the large emerging markets are in strong fiscal and balance of payment positions to expand domestic demand in the event of a slowdown. Though they now account for only about 35 percent of world GDP at market exchange rates, in recent years, developing countries have accounted for about half of global growth.

We estimate the potential growth rate of developing countries to be just over 5 percent a year, which—given their current share of world output—translates into a 1.

China alone has accounted for 22 percent of world growth since , and a much higher share during the Great Recession. Despite inflationary pressures, its growth—driven by a supply-side transformation—is likely to remain resilient. Nonfinancial corporations in advanced countries are in good financial shape.

By , regional activity is expected to remain 6 percent below pre-pandemic projections. Risks to the regional outlook remain predominantly to the downside. Limited vaccine progress suggests that the pandemic may intensify again, new variants may emerge, and mobility restrictions may be reimposed. The region is also exposed to risks from conflict and social unrest, high debt in some economies, and unfavorable commodity price developments.

These risks could interact and further undermine living standards, increase deprivation for vulnerable communities, and heighten food insecurity. Output in the Middle East and North Africa region is projected to grow by a subdued 2.

Risks to the regional outlook remain predominan Stronger-than-expected momentum at the beginning of the year has been disrupted by a large surge of COVID cases. Despite continued recovery, output in is forecast to be 9 percent below pre-pandemic projections. Poverty rates have risen, and by the end of this year more than half the new global poor are expected to live in the region.

The outlook could be weaker if vaccination does not proceed as quickly as assumed. Moreover, financial sector balance sheets are at risk of deteriorating, as policy measures put in place at the peak of the pandemic are scaled back, which could constrain the provision of credit and investment needed to support the recovery.

Output in South Asia is expected to expand 6. The outlook could be weaker if vaccination does not proceed as quickly as Positive spillovers from strengthening global activity, better international control of COVID, and strong domestic activity in agricultural commodity exporters are expected to gradually help lift growth. Nonetheless, the recovery is envisioned to remain fragile, given the legacies of the pandemic and the slow pace of vaccinations in the region. In a region where tens of millions more people are estimated to have slipped into extreme poverty because of COVID, per capita income growth is set to remain feeble, averaging 0.

Risks to the outlook are tilted to the downside, and include lingering procurement and logistical impediments to vaccinations, further increases in food prices that could worsen food insecurity, rising internal tensions and conflicts, and deeper-than-expected long-term damage from the pandemic.

In a region where tens of millions more people are estimated to have slipped into extr Lowering cross-border trade costs could help revive trade growth. Trade costs are high: on average, they double the cost of internationally traded goods in comparison to domestic goods.

Tariffs account for only one-fourteenth of average trade costs; the bulk of trade costs are incurred in shipping and logistics, as well as cumbersome trade procedures and processes at and behind the border.

Despite a decline since , trade costs remain almost one-half higher in EMDEs than in advanced economies; about one-third of the gap may be accounted for by higher shipping and logistics costs and another one-third by trade policy. A comprehensive reform package to lower trade costs would include trade facilitation measures; deeper trade liberalization; efforts to streamline trade processes and clearance requirements; better transport infrastructure; more competition in domestic logistics, retail, and wholesale trade; and less corruption.

Some of these measures could yield large dividends: among the worst-performing EMDEs, a hypothetical reform package to improve logistics performance, maritime connectivity, and border processes to those of the best-performing EMDEs is estimated to halve trade costs. As the global economy rebounds from the COVIDinduced global recession, the accompanying strength in global trade offers an opportunity to jump-start the recovery in emerging market and developing economies EMDEs.

Tariffs account for only one-fourteenth of average trade costs; the bulk of trade costs are incurred in shipping and logistics, as well as cumbe Chapter Highlights Charts. After declining in the first half of , global inflation has rebounded quickly on recovering activity.