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This paper puts the original Reinhart-Rogoff dataset, made public by Herndon et al. (2013), to a formal econometric test to pin down debt thresholds endogenously. We show that the nonlinear relation from debt to growth is not very robust.
Notwithstanding a very strong economic performance over the past decade or so, Poland’s per capita income is substantially lower in comparison with the United States and per capita income growth will be sharply slowing down over the coming decades under the scenario of gradual policy changes mostly because of population ageing.
Composite leading indicators (CLIs), designed to anticipate turning points in economic activity relative to trend, point to moderate improvements in growth in most major economies.
New Zealand’s key challenges are to achieve sustainable and equitable growth while reducing macroeconomic vulnerabilities. Policies are on the right track, and reforms should focus on improving productivity and the distribution of skills.
Consumer prices in the OECD area rose by 1.3% in the year to April 2013, the lowest annual inflation rate since October 2009. Energy prices fell to 1.3% in the year to April, compared with an increase of 0.9% in the year to March. On the other hand, annual food price inflation rose by 2.0% in April, up from 1.7% in March. Excluding food and energy, the OECD annual inflation rate slowed to 1.4% in April, compared with 1.6% in March.
The problems of Japanese agriculture – in particular low productivity and the prevalence of part-time farmers and small plots have been evident for the past 50 years.
Income inequality and relative poverty in the United States are among the highest in the OECD and have substantially increased over the past decades. These developments have been associated with a number of other worrying statistics, including low intergenerational social mobility and weak real income growth for many households.
Intergovernmental fiscal frameworks usually reflect fundamental societal choices and history and are not foremost geared towards achieving economic policy objectives. Yet, like most institutional arrangements, fiscal relations affect the behaviour of firms, households and governments and thereby economic activity.
The global economy is moving forward, but divergence between countries and regions reflects the uneven progress made toward recovery from the economic crisis, according to the OECD’s latest Economic Outlook. Historically high unemployment remains the most serious challenge facing governments.
With gross government debt surpassing 200% of GDP, Japan’s fiscal situation is in uncharted territory. In addition to robust nominal GDP growth, correcting two decades of budget deficits requires a large and sustained fiscal consolidation based on a detailed and credible multi-year plan that includes measures to control spending and raise revenue.