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Contents | Executive summary | How to obtain this publication | Additional information
The following OECD assessment and recommendations summarise chapter 4 of the Economic survey of Finland published on 3 June 2008.
Contents
Greater competition in the delivery of social services would spur productivity growth and facilitate economic diversification
Social services, which are mainly delivered by the municipalities, account for almost 20% of total economy value added, making it the second most important sector after manufacturing. But productivity has declined, posing fiscal sustainability concerns and the risk of labour shortages in key social services as the population ages. A significant number of municipal mergers are under way which may improve efficiency in the long term, although the number of municipalities (about 350 even after the mergers) will remain far too high. To raise productivity a sharper distinction should be drawn between core and non-core services with municipal resources being increasingly focussed on the former. The private sector should be encouraged to play a larger role in the provision of social services – particularly support services that are not considered core outputs. This will require more active encouragement of competition between public and private providers of services. The central government should ensure that the framework conditions in which municipalities operate guarantee a level playing field between private and public providers. This may require changes to public procurement legislation and the introduction of policies to encourage the incorporation of all municipally-owned activities that constitute economic activities. There is also considerable scope for the central and municipal governments to promote municipal-level productivity gains, such as by developing more sophisticated benchmarking exercises and other measures to facilitate the sharing of best practice municipal management.
Productivity gap relative to the United States
Contribution to the overall productivity gap1 in selected industries, per cent
1. Productivity measured as value added per employee, converted to US dollars using 2000 purchasing power parities and weighted by employment share.
Source: OECD calculations based on OECD (2007) Structural Analysis (STAN) database and Statistics Finland.
How to obtain this publication
The Policy Brief (pdf format) can be downloaded in English. It contains the OECD assessment and recommendations.The complete edition of the Economic survey of Finland 2008 is available from:
- Subscribers and readers at subscribing institutions can access the online edition via SourceOECD , our online library.
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Non-subscribers can purchase the PDF e-book and/or paper copy via our Online Bookshop
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Government officials with accounts ( subscribe) can go to the "Books" tab on OLIS
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Additional information
For further information please contact the Finland Desk at the OECD Economics Department at eco.survey@oecd.org. The OECD Secretariat's report was prepared by Anne-Marie Brook, Petar Vujanovic, Marketta Henriksson and Marte Sollie under the supervision of Peter Hoeller. Research assistance was provided by Isabelle Duong.
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