Governments play a critical role in creating prosperity by supporting economic growth. This requires a business environment enabling enterprises to invest, innovate and grow. Public institutions therefore need to enable fair market access and competition; avoid undue regulatory burdens; and ensure that rules, regulations and contracts are fairly and reliably enforced within a stable macroeconomic environment.
Corruption deepens inequalities and weakens growth. It hampers investment, competition and entrepreneurship, and affects key determinants of productivity growth, including innovation and use of new technologies, the market environment, and public and private investment decisions (OECD, 2024). Lobbying is a natural part of the democratic process but needs to be managed to ensure fairness. On average, OECD countries fulfil only 42% of OECD criteria on the strength of laws, regulations and mandates related to lobbying, and only 36% on their implementation in practice (Figure 3.4). Lack of transparency over lobbying could benefit incumbents and well-funded corporations, but just over half of OECD countries with data available have defined lobbying activities and lobbyists, and a similar share have a publicly available lobbying register (OECD, 2024).
Fair enforcement of regulations is also important, with no enterprise or interest group able to gain unfair advantage by delaying or avoiding enforcement. The average score across the OECD for the quality of regulatory enforcement is 0.72 on a scale of 0 to 1 (Figure 3.5). This has changed little since 2014 (0.70). However, 21 of 29 countries with data available (72%) have improved, with only 8 worsening. The greatest improvements were in Germany (+0.10) and Czechia (+0.09), which both reduced delays in enforcement.
Growth requires businesses and customers to have confidence that they will not be defrauded and that contracts can be enforced. This in turn requires fair, impartial, affordable and accessible civil justice. The average score across the OECD for the quality of civil justice is 0.68 on a 0-1 scale, a figure that has changed little since 2014 (0.67) (Figure 3.6). Just over half of the OECD countries with data available improved over this period (16 out of 30, 53%), while the rest worsened. The greatest improvements were in Estonia (+0.08), which reduced delays in access to justice, and Slovenia (+0.09), which improved enforcement of civil judgements.
Fiscal objectives and rules help guide economic policy and support a stable macroeconomic environment. Setting clear fiscal targets can help limit public spending, achieve fiscal goals and promote prudent fiscal management. In 2023, the most common objective was for a balanced budget, adopted by 34 of 36 OECD countries (94%), with 5 countries having a quasi-permanent fiscal rule in their constitution and 24 enshrining it in law. This was followed by limits on public debt and public spending, both applied in 30 OECD countries (83%), and limits on revenue in 15 (42%) (Online Table J.1.1).
