Browse by: "F"

Despite growing aid volumes, financing development is becoming more difficult, not less. Better information on private finance flows will help developing-country governments craft more effective policies. Without stronger government leadership, well-intentioned but diverging donor approaches risk cancelling each other out.

This paper discusses recent developments and policy issues relating to financial markets in Iceland. Overall, the sector is thriving, both relative to history and to conditions in other countries. This bodes well not only for those directly involved in the industry but for the country as a whole, as financial development is an important source of economic growth. Recently concerns have been expressed about the stability of the financial system; however the guarded assessment...

Limited capacity to pay, large infrastructure needs and a huge backlog in the construction of sanitation facilities make recourse to cross-subsidies and government-funded subsidies a necessity in Africa. * This Policy Insights introduces the African Economic Outlook 2007.

Hungarian family policy focuses on providing generous options to take time off work to look after children. This system not only contributes to Hungary’s low employment rate but encourages long separation from the labour market, has largely failed to significantly influence fertility rates and is relatively expensive to run. This paper looks at how to shift the policy focus towards reconciling work and family life. Reasons for under-provision in childcare by local governments are discussed and recommendations for further central-government intervention to improve supply are made. Recommendations for reform are also made regarding the complex system of family cash benefits and leave allowances.

There is growing recognition throughout the OECD of the need to link economic development and employment policies at the level of the individual city if the twin objectives of raising competitiveness and reducing worklessness are to be met. The challenge is particularly clear in the UK, where the employment rate of the working age population in the major cities has lagged consistently behind the relatively strong performance of the nation as a whole (HM Treasury, 2007). The Government has recognised that raising the UK employment rate towards its ambitious 80%national target will  require special  efforts to tackle unemployment and economic inactivity in the cities (Department of Work and Pensions, 2006). This is an important departure from the traditional  emphasis on national  labour market policies and standardised welfare to work programmes that pay little regard to geographical variations in socio-economic conditions.

One of the issues arising is the appropriate balance between measures to stimulate labour demand and create  jobs, on the one hand, and measures to strengthen  labour  supply by improving people’s skills, employability and motivation, on  the  other.  There is also an issue about how to connect employment opportunities to people in need of work but who face multiple disadvantages and barriers to employment, such as poor transport access and lack of childcare. Another issue relates to the amount of decentralisation and local control of the policy levers that government should encourage, and what form this should take.  

The purpose of this paper is to address these important questions by  focusing on the labour market context and policy situation in Glasgow.

Fiscal equalisation is a transfer of fiscal resources across jurisdictions with the aim of offsetting differences in revenue raising capacity or public service cost. Its principal objective is to allow sub-central governments to provide their citizens with similar sets of public services at a similar tax burden. Fiscal equalisation can be seen as the natural companion to fiscal decentralisation as it aims at correcting potential imbalances resulting from sub-central autonomy. If sub-central governments had no fiscal power, no fiscal equalisation would be needed. Distinct fiscal equalisation arrangements first emerged during the 1940s and 1950s in a number of federal countries, and today most OECD Member countries have introduced some explicit or implicit fiscal arrangement that reduces fiscal disparities across jurisdictions. The significance of fiscal equalisation is highlighted not only by its extensive use in both federal and unitary countries, but also by the fact that its objectives and principles are often laid down in the constitution and hence form a central pillar of national fiscal policy.

This paper is the first of four country case studies which is a part of a broader research programme addressing trade and structural adjustment issues in non-member economies which was conducted as a follow-up to Trade and Structural Adjustment: Embracing Globalisation (OECD, 2005) which identified policies for successful trade-related structural adjustment. This paper studies the trade liberalisation experience of Chile from 1973 onward. The report consists of 5 main parts; Part 1 provides the introduction, part 2 looks at the trade liberalisation in Chile which was implemented in three phases, (1) initial trade reforms (1973-84), (2) trade reform after a temporary policy reversal(1985-89) and (3) after 1990. Part 3 looks at the evolution and structure of exports and imports, and Part 4 looks at sectoral developments in the copper industry, agrofood industry, wood and wooden products industry and the textiles and clothing industry. Part 5 concludes with lessons learnt. The experience of Chile shows that trade reform has been essential for realigning the incentive structures in Chile. A stable macroeconomic environment, trade reform starting with the elimination of quantitative restrictions, introduction of flat tariffs, coherent exchange rate policy, sound institutional framework, rule of law, mild promotion of exports, use of foreign capital, and relatively flexible labour market policies have been important factors in Chili's successful trade liberalisation experience.

This paper is the second of four country case studies which is a part of a broader research programme addressing trade and structural adjustment issues in non-member economies which was conducted as a follow-up to Trade and Structural Adjustment: Embracing Globalisation (OECD, 2005) which identified policies for successful trade-related structural adjustment. This paper studies the trade liberalisation experience of the Philippines from the 1980s. The report consists of 7 main parts; Part 1 provides the introduction, part 2 looks at the economic policies in the Philippines from the 1970s, and part 3 takes a general look at the general structure of the economy. Part 4 takes a closer look at the trade liberalisation in the Philippines which was implemented in three phases, (1) initial trade reforms (1981-88), (2) second phase (1991-93) and (3) third phase (1994-96). Part 5 takes an overview of the structural adjustments which took place in manufacturing and agriculture, with Part 6 taking a closer look at four sectors, electronics, food processing, cement, and business process outsourcing sectors. Part 7 concludes with lessons learnt and opportunities and challenges for further liberalisation. Despite considerable liberalisation including in trade policy since the 1980s, the Philippines economy posted only lacklustre performance initially. After a growth period in the 1990s and the Asian crisis, it is only in the recent past that some of the reforms are starting to pay off. The importance of a stable political and macroecnomic environment, need for appropriate exchange rates, need for early elimination of quantitative restrictions in trade reform, early deregulation on FDI are some of the lessons learnt. While challenges remain, better results are expected in the future if complemented with further reforms.

This paper analyses the effect of fiscal decentralisation on health outcomes in China using a panel data set with nationwide county-level data. We find that counties in more fiscally decentralised provinces have lower infant mortality rates than counties where the provincial government remains the main spending authority, if certain conditions are met. Spending responsibilities at the local level need to be matched with county governments’ own fiscal capacity. For county governments that have only limited revenues, the ability to spend on local public goods such as health care depends crucially upon intergovernmental transfers. The findings of this paper, therefore, support the common assertion that fiscal decentralisation can lead to more efficient production of local public goods, while also highlighting the conditions required for this result to be obtained.

It is a truism that future prices of energy for transportation will be determined by the forces of supply and demand. For transport fuels, these forces have entered a crucial phase that is likely to persist for several decades. Oil production from conventional resources outside of the OPEC countries will peak within a few years. Unconventional fossil resources that can be exploited at current prices, resources whose early development is already well underway, pose an even greater threat to the global climate. To bring these resources to the market at a rate to match the growth in demand for mobility fuels in the developed and developing economies will require massive, risky investments. Serious risks are posed by the environmental acceptability of these fuels and also by the fact that a sudden downturn in world oil prices would turn them into stranded assets. It is also a truism that no one can accurately predict the price of oil. Today, oil costs $70 per barrel. Ten years ago, it cost less than $20 per barrel. Twenty seven years ago oil prices peaked at $90 per barrel. Thirty-seven years ago oil cost only $10 per barrel and its price had been relatively stable for almost fifty years. Those who carefully craft future oil price scenarios know that they are not predicting but rather attempting to define alternative paths of central tendency. Even the best official oil price projections look nothing like the past thirty-five years of history. It is important to understand why this is so. Since 1972, world oil prices have been strongly and unpredictably influenced by the actions of the OPEC cartel. It is very likely that they will be for the next thirty years, as well.

America’s higher education system is among the best in the world. Nevertheless, there is scope for improvement. In particular, there appear to be substantial financial barriers to higher education despite large government expenditures aimed at promoting access. Policy makers have proposed addressing these barriers by increasing student grants. However, grants are costly, inefficient, inequitable and ineffective. Income tax concessions and state government subsidies suffer from similar problems. In contrast, international best practice seems to be converging on student loans with repayments that vary according to income. Income-contingent loans facilitate access to college at low fiscal cost and without the inefficiency and inequities that accompany grants, subsidies or tax concessions. At the same time, they do not discourage risk-averse or uninformed students in the way that conventional loans do. The United States has an income-contingent loan programme that should be expanded. While the design of repayments could be improved, the main problem with this programme is that lending limits are too low. Higher limits, especially for unsubsidised direct loans, would benefit students and promote access at little cost to the government. Were a good system of loans in place, then less cost-effective means of promoting access, such as grants and tax concessions, should be cut back.

This study evaluated the precipitating and debilitating factors that occurred in the emergence and growth of the private university system in Nigeria. Three research questions guided the analysis and examined enrolment patterns in seven pre-2003 private universities, students’ preferences for enrolment and the factors that encouraged and discouraged their emergence and growth in Nigeria. Data was gathered from published documents, research reports, government releases, memos, newspapers and the Internet and then analysed qualitatively, using tables and simple percentage computations. The study found that the private university system, having suffered an initial setback in the 1980s, has renewed success today because of the obvious failure of the public university system to adequately address multiple problems such as access, quality, funding, strikes, cultism, stability of the academic calendar –- which the private system has been able to overcome more effectively. However, it was noted that the private system is prohibitively expensive for the majority of qualified but indigent prospective applicants. The study recommends, in addition to special scholarship programmes, the design of a special student aid programme, accompanied by a traceable and institutionalised repayment system based on models found in certain developed countries.

by Gboyega Ilusanya and S.A. Oyebade

OECD countries invest significant resources in evaluating agricultural pesticides before they are marketed (or re-evaluating pesticides that have been in use for many years) to ensure that they do not pose unacceptable risks to human health and the environment. Since many pesticides used in OECD countries are the same, governments have recognised the substantial benefits that can be gained if the task of pesticide evaluations for registration and re-registration is shared, rather than duplicating each others' work. The OECD Pesticides Programme is working to establish the infrastructure that will facilitate such work sharing. The recent adoption of an OECD-wide future "vision", with specific deadlines for work sharing, should lead to additional (and more routine) work sharing arrangements between governments and industry.
This document provides responses to questions that are frequently asked by governments and industry about the concept of work sharing, and how it would operate in practice. Many of the questions were raised at an OECD seminar on work sharing, held on 31 May, 2006, at the Pesticide Control Service in Ireland. The answers were prepared by a panel of OECD government representatives at that seminar.

China helps growth and debt sustainability in Africa through debt relief, infrastructure investment and higher exports. China and other emerging lenders should engage in a debt transparency initiative that considers such growth effects. This will encourage emerging lenders to co-operate with the ‘international community’ on Africa’s debt sustainability.

Among economists and policy makers more general, the fuel efficiency standard for cars and the fuel tax have been the subject of extensive debate. The major benefits of stricter fuel efficiency standards and higher fuel taxes are the reduction of Greenhouse gas emissions and the reduced oil dependence. The major costs are the increased production cost, the reduced comfort and the negative impact on mileage related externalities (congestion, accidents) due to the rebound effect. In this contribution we use a wider framework than Harrington (2008), Plotkin (2008) and Raux (2008) to discuss the CO2 1 emission reduction in transport. In section 2 we analyze, for the EU, the effects on welfare and CO2 emissions of pricing all transport activities according to their full social costs. In section 3, we go beyond the transport sector and compare the options to reduce emissions in the transport sector with the possibilities and costs to reduce emissions in other sectors of the economy. In section 4 we take a world view and analyze the impact of two types of international climate negotiations on the emission reduction strategy in the transport sector.