The Sources of Economic Growth in OECD Countries

Growth patterns through the 1990s and into this decade have turned received wisdom on its head. For most of the post-war period OECD countries with relatively low GDP per capita grew faster than richer countries. In the 1990s this pattern broke down. Most notably, the United States, which, already with a relatively high level of GDP per capita among the world's major economies, drew further ahead of the field from the second half of the 1990s onwards. The growth performance of much of continental Europe remains comparatively weak and Japan remains mired. What are the root causes of the divergence in growth across the OECD? How much of it can be attributable to new technology and R&D? What role has macroeconomic policy played? How important is education and training? Are unemployment, labour market flexibility and product market competition important influences? Do business start-ups help bring new capital and ideas to markets? How important are the barriers to business start-up and closure? This publication provides a comprehensive overview of these issues and new insights on what drives economic growth in OECD countries.