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Are OECD policy recommendations for public sector reform biased against welfare states? : Evidence from a new database

Bergh, Andreas LU ; Dackehag, Margareta LU and Rode, Martin (2016) In European Journal of Political Economy
Abstract
Policy advice by the OECD has long been at the heart of academic debates on welfare state reform, with frequent claims questioning the ideological orientation of recommendations. This paper constructs an indicator of perceived reform need for 24 countries, quantifying the policy advice contained in the OECD Economic Surveys around 1985, 1995, and 2005. These recommendations describe a policy consensus that is based on competition, work incentives, monetary reform, fiscal discipline, and labor market reform. Empirically, perceived need for reform is well explained by preceding levels of economic freedom. In particular, countries with more government intervention, lower property rights protection, and more regulation are perceived to have a... (More)
Policy advice by the OECD has long been at the heart of academic debates on welfare state reform, with frequent claims questioning the ideological orientation of recommendations. This paper constructs an indicator of perceived reform need for 24 countries, quantifying the policy advice contained in the OECD Economic Surveys around 1985, 1995, and 2005. These recommendations describe a policy consensus that is based on competition, work incentives, monetary reform, fiscal discipline, and labor market reform. Empirically, perceived need for reform is well explained by preceding levels of economic freedom. In particular, countries with more government intervention, lower property rights protection, and more regulation are perceived to have a bigger reform need. In turn, perceived reform need has no explanatory power for subsequent changes in social expenditure and welfare state entitlements. Only in countries with right wing governments, perceived reform need might be followed by marginal reductions in welfare state entitlements, but definitely not in social expenditure. (Less)
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author
organization
publishing date
type
Contribution to journal
publication status
epub
subject
keywords
welfare states, reform, OECD, economic institutions
in
European Journal of Political Economy
pages
13 pages
publisher
Tranfer Verlag, Regensburg, FRG
external identifiers
  • scopus:85008690120
  • wos:000407402100002
ISSN
0176-2680
DOI
10.1016/j.ejpoleco.2016.09.001
language
English
LU publication?
yes
id
28bf0986-ba6b-4694-ae66-1ccf74b94b97
date added to LUP
2016-11-14 14:16:41
date last changed
2017-09-18 11:30:13
@article{28bf0986-ba6b-4694-ae66-1ccf74b94b97,
  abstract     = {Policy advice by the OECD has long been at the heart of academic debates on welfare state reform, with frequent claims questioning the ideological orientation of recommendations. This paper constructs an indicator of perceived reform need for 24 countries, quantifying the policy advice contained in the OECD Economic Surveys around 1985, 1995, and 2005. These recommendations describe a policy consensus that is based on competition, work incentives, monetary reform, fiscal discipline, and labor market reform. Empirically, perceived need for reform is well explained by preceding levels of economic freedom. In particular, countries with more government intervention, lower property rights protection, and more regulation are perceived to have a bigger reform need. In turn, perceived reform need has no explanatory power for subsequent changes in social expenditure and welfare state entitlements. Only in countries with right wing governments, perceived reform need might be followed by marginal reductions in welfare state entitlements, but definitely not in social expenditure.},
  author       = {Bergh, Andreas and Dackehag, Margareta and Rode, Martin},
  issn         = {0176-2680},
  keyword      = {welfare states,reform,OECD,economic institutions},
  language     = {eng},
  month        = {09},
  pages        = {13},
  publisher    = {Tranfer Verlag, Regensburg, FRG},
  series       = {European Journal of Political Economy},
  title        = {Are OECD policy recommendations for public sector reform biased against welfare states? : Evidence from a new database},
  url          = {http://dx.doi.org/10.1016/j.ejpoleco.2016.09.001},
  year         = {2016},
}