OECD Member Research Articles

Potential Years of Life Lost and Its Implication on Economic Output: Assessment of OECD Members and Candidate Countries for the Period 1993-2018

Abstract Over the last 30 years, significant geopolitical, social, and economic changes have impacted the OECD members and candidates, which has led to a significant improvement in the quality of life and life expectancy, with the reduction of the potential years of life lost one of the indicators of reduced mortality observed across the group. On the geopolitical side, the admission of the Baltic countries and their standardization of the metrics to track demographics more aligned with the internationally accepted practices, on the social side; the increase in life expectancy poses challenges to the care of the elders but also the extension on the age within the labor force and lastly, on the economic changes; the ongoing increase of income and GDP has led to an expanded access of care including goods and services. This paper explores the use of mortality information and potential years of life lost as a beacon to point toward the economic burden of poor health and its related mortality.

Declining real interest rates: The role of energy prices in energy importers

This study investigates whether the upward trend in real energy prices since the 1990s can account for the decreasing trend in real interest rates in energy-importing countries. By estimating dynamic panel data models, I first provide empirical evidence that a rise in real energy prices leads to falls in real interest rates and aggregate consumption in energy-importing OECD member countries. Using a life-cycle model, I show that the increasing trend in real energy prices decreased the equilibrium real interest rate by about 1.4 percentage points between 1990 and 2018. The mechanism for this effect is as follows: As a result of the increases in the real energy price, energy consumption falls, dampening the consumption of manufactured goods because of the complementarity in consumption between energy and manufactured goods. Accordingly, aggregate consumption declines, putting downward pressure on the real interest rate. Moreover, the increased real energy price decreases energy input in production, raising the capital/energy ratio and inducing a lower real interest rate via a fall in the marginal product of capital. Through a simulation, I also demonstrate that increases in the real energy price had a greater influence on the declining real interest rate in energy-importing countries during 1990–2018, compared to population aging.

공적개발원조 성과관리

In many OECD member countries, including South Korea, Official Development Assistance (ODA) has been steadily increasing. However, criticisms have been raised regarding the limited tangible impact compared to the amount of assistance provided. Hence, there is a growing emphasis on managing ODA outcomes based on the policy validity and sustainability of aid projects and on the importance of project evaluations from the recipient country's perspective. In this study, drawing on prior research, we conceptualized aid quality through sub-factors such as service quality, delivery quality, expectation levels, and social responsibility. We analyzed their effects on aid satisfaction using a structural model. Notably, we incorporated experience in the relevant field and country-specific collaboration experiences as moderating variables to validate the maturity of the aid system. Our findings suggest that social responsibility and expectation levels positively influence aid satisfaction. Conversely, experience in the relevant field and collaboration experience in specific countries showed significant impact only in certain paths. These results indicate the necessity of meeting expectation levels and fulfilling social responsibilities to enhance aid satisfaction. Furthermore, there's a demand for a sustainable management system that elucidates the causal relationships between aid environment and influencing factors and evaluates outcomes from the beneficiary country's viewpoint.

Non-homogeneity in the efficiency evaluation of health systems

BackgroundAn international comparison of health system performance is a popular tool of health policy analysis. However, the efficiency evaluation of health systems is a practical example of an international comparison in which non-homogeneity is expected. The objective of this paper is to evaluate the efficiency of health systems by models in which a degree of non-homogeneity among countries is considered.MethodsWe study the problem of non-homogeneity of health systems in the theoretical framework of the data envelopment analysis (DEA), which is a popular method of efficiency evaluation with hundreds of applications from various fields. DEA assume the homogeneity of production units and the homogeneity of the environment in which the production units operate. Hence, we compiled a summary of 14 recommendations on how to deal with the non-homogeneity in the DEA models. The analysed sample includes 38 OECD member countries. The data are from the year 2019.ResultsAs an example, we evaluated the health system efficiency of the Czech Republic. We used the DEA models with the neighbourhood measure of distance and the constraint limiting the comparison of countries with different levels of economic development. The health system inputs were the numbers of physicians, nurses, and hospital beds. In the production of the intermediate outputs (doctor consultations, inpatient care discharges), the Czech Republic should look at Poland, Slovakia and Slovenia. In the production of health outcomes (life expectancy), the peer countries are France, Italy and Switzerland.ConclusionsThe results of the DEA analysis are only indicative because no single analytical method can determine whether a health system is better or worse than others. We need to combine different methods, and DEA is one of them. We consider DEA as an exploratory method, not a method providing definitive answers.

Impact of quantitative safety targets on road fatality reduction: an empirical support toward governance plan.

The role of quantitative target setting has become an important topic in debates on the improvement of road safety performance. Specifically, there are questions regarding the relationship between quantitative safety targets and their actual effects. Although previous studies have provided important insights into this subject, their empirical findings have largely been equivocal, and research on this topic remains inadequate. Based on panel data representing 20 years of observations from 34 OECD member states, we employed nonlinear and linear panel models to investigate whether and how the attributes of quantitative road safety targets (i.e., target ambition and duration) influence their success (i.e., target completion status and rate). The results indicate that a quantitative target with a higher level of ambition is associated with a lower likelihood and rate of completion, whereas there is no support for a connection between target duration and final completion rate. This suggests that an excessively ambitious target does not necessarily result in better road safety performance and is detrimental to achieving expected fatality reductions. From an empirical perspective, this study revealed a potential interaction effect between quantitative road safety targets and practical fatality reduction performance, providing government officials and policymakers with essential references for future practices on target setting and governance planning in regard to public health.

A global‐scale study on decision making in renewable energy policy: Internal and external factors driving the adoption of Feed‐in Tariffs and Renewable Portfolio Standards

AbstractTo accelerate the clean energy transition, it is necessary to better understand the global policy dynamics and motivations behind clean energy policy adoptions and diffusion. This article examines the differential roles of internal and external diffusion factors on decisions to adopt renewable energy policies, that is, Feed‐In Tariffs (FIT) and Renewable Portfolio Standards (RPS), employing a unique blend of cluster analysis and event history analysis. Cluster analysis uncovers a dichotomy in adopting countries. First, early adopters emerge as high‐income, democratic countries, mostly energy importers with high CO2 emissions, with OECD and EU membership. Conversely, the second cluster consists of adopters from middle‐income, non‐OECD, and non‐EU nations with lower CO2 emissions. Strikingly, these clusters align with UNFCCC party classifications, underscoring the pivotal role of international agreements. Event history analysis suggests that especially environmental pressure, but also democratic governance and economic development are important when adopting renewable energy policies. Interestingly, environmental endowments seem to be less important. These findings lead to an important question: Are the requisite policy tools readily available to navigate diverse socio‐economic, political, and environmental landscapes, and are they deployed in a timely fashion? Beyond these findings, the study also shows that policy diffusion especially through normative emulation and social learning—operationalized as political globalization, OECD member and following regional neighbors—are important for policy adoption, suggesting the importance of such tools for promoting policies. Moreover, distinctive factors come into play when examining the adoption of FIT versus RPS policies, emphasizing the need for nuanced policy approaches.

The Influence of Student-Level Factors on Reading Literacy: A Comprehensive Study

The aim of the present study was to examine the factor affecting reading performance of the students in a broad sense. The sample was comprised of a total of 752076 students who participated in PISA studies from OECD member countries during the years of 2000 (n = 159095), 2009 (n = 298454) and 2018 (n = 294527) in which reading literacy was the major domain of interest. The causal relationships were examined by using a series of multiple linear regressions by using IDB Analyzer software which creates syntaxes that replicate the analysis 80 times for each plausible value and calculate the average values by taking into account the student weights as suggested in the PISA manuals. The results revealed that enjoyment of reading (at 91%, 100%, and 56% of countries in 2000, 2009, and 2018, respectively), and index of economic, social, and cultural status (at 81%, 91%, and 91% of countries in 2000, 2009, and 2018, respectively) were ranked among the most significant variables that predict reading literacy in all three PISA cycles. While metacognition was not included in 2000, it was among the most important variables (at 100% of countries) in 2009 and 2018.

Performance indicators in long-term care for older people in 38 countries: a scoping review

Abstract Background A large number of performance indicators in long-term care have been developed and tested. However, the use of such indicators for regular monitoring of long-term care at regional and national level presents a number of challenges related to coordination of stakeholders, regulation and data collection capabilities. Our aim was to review the performance indicators in long-term care that are currently in use for regular monitoring by 38 OECD member states. Methods We used a scoping review approach that included a systematic search of scientific publications, review of multi-country reports and an internet search of relevant websites of the countries included. The scoping review protocol was registered before starting paper selection and web searches. Results We retrieved 12.776 papers, of which 10 were kept after selection for data extraction. Preliminary results of the review of reports and internet resources led to the retrieval of 399 performance indicators in long-term care from 24 OECD member states, while no indicators could be found for 14 member states. Performance indicators most often relate to falls, pressure ulcers, unplanned weight loss and use of restraints, which are collected by 7 or more of the 24 countries. The definitions of the indicators differ considerably between countries, as well as the definitions of long-term care and hence the settings in which these indicators are used. Conclusions Consideration of indicators often used in several countries may be of interest to decision-makers establishing or updating indicator sets in this area. There is considerable heterogeneity in the nature, definitions and settings of long-term care performance indicators used by OECD member states. These differences are a significant challenge to establish international comparability of the indicators reported. Key messages • The indicators most frequently used for regular monitoring of long-term care performance are related to falls, pressure ulcer, unplanned weight loss and use of restraints. • There is considerable heterogeneity in the nature, definitions and settings of long-term care performance indicators used in different countries, which make comparisons of results challenging.

Local autonomy around the world: the updated and extended Local Autonomy Index (LAI 2.0)

ABSTRACT This paper presents an extension and update of the Local Autonomy Index (LAI) under the name LAI 2.0. It applies the comprehensive methodology of the LAI 1.0 to 57 countries over 30 years (1990–2020), including almost all EU, CoE and OECD member states. Looking at the overall results, over thirty years, the LAI has increased around 7–8%, albeit less important in the most recent period of 2015–2020. The biggest increase is to be found in the Central and Eastern European countries. Conversely, some countries (e.g. Hungary and Belarus) have seen a decrease in local autonomy. The highest ranking countries include the Nordic countries and Switzerland, whereas South-Eastern European countries generally score the lowest. We view the LAI as a springboard to academics and policymakers for a more comprehensive and empirically based understanding of local autonomy over time.

Will they rise again? Four scenarios for the future of trade unions

With rising consumer prices, tight labour markets, a resurgence in labour militancy, and a new post-Covid appreciation of the role of government and market regulation, the conditions for renewed union growth seem favourable. But unions have to come from far. Across the OECD, unions have lost members and power, young people increasingly stay away from unions and labour markets have thoroughly changed from what they were. How likely, then, is a new era for trade unions? This article explores four scenarios for the future of trade unions – marginalization, dualism, substitution and revitalization – each grounded in a few assumptions about the environment and behaviour of unions. Drawing on data and research from 12 OECD member states, the article explores middle range theories for each scenario and weighs arguments pro and contra its likelihood. It concludes with a set of critical propositions about the future of trade unions and research about the future.

Central Bank Credibility’s Effect on Stock Exchange Returns’ Volatility: Evidence from OECD Countries

Central bank characteristics are important determinants of stock market returns and their volatility. While the literature has examined the effects of transparency and independence, no research has been conducted so far on the effect of central bank credibility on stock market returns’ volatility. A panel regression using financial and macroeconomic data from 45 OECD member countries over the period of 1998–2022 tested the hypothesis that central bank credibility determines stock exchange returns’ volatility. The results indicated that credibility reduces stock returns’ volatility, remaining robust and statistically significant across models. Economic growth also decreases stock market volatility, while money-market interest rates’ volatility, the stock market’s turnover ratio, and economic/financial crises act as amplifying factors of stock market volatility. All variables, except for economic growth, exhibit unidirectional causality, leading to changes in stock market volatility.

OECD Ülkelerinde Finansal Yenilik ve Çevre Kirliliği Arasındaki İlişki

Climate changes as a result of environmental degradation have negative effects in many areas. Many studies in the economics literature have examined the effects of these negativities from different perspectives. In this study, the relationship between financial innovation and CO2 emission, which is newly used in the literature, is examined for 14 OECD member countries. LLC and IPS unit root tests, Pedroni and Kao cointegration tests and FMOLS estimator were used in the analyses for the period between 2009 and 2019. According to the findings obtained from the analyses, it is seen that financial innovation, economic growth and urbanization have negative effects on CO2 emissions. In addition, in the results of Dumitrescu-Hurlin causality test applied in the study, it was determined that there is a bidirectional causality relationship between economic growth, urbanization and CO2 emissions, and a unidirectional causality relationship between financial innovation and CO2 emissions. In this direction, it is considered important that companies and governments should act together. It is considered that the creation of green loans by financial intermediaries for environmentally sensitive projects can encourage investors. In order to prevent environmental degradation from a holistic perspective, the government should take measures such as subsidies and tax reductions to encourage environmentally friendly projects.

Renewable energy performance analysis using fuzzy dynamic directional distance function model under natural and managerial disposability

Addressing the dynamic performance aspects of processes and identifying the sources of inefficiency are key considerations for making informed decisions, especially in situations where imprecise data are available. This study aims to evaluate the performance of renewable energy using the Fuzzy Dynamic Directional Distance Function (FDDDF) model considering natural and managerial disposability for 34 OECD member countries. As a non-parametric methodology, Data Envelopment Analysis (DEA) is used to measure dynamic fuzzy environmental efficiencies of renewable energy through multiple fuzzy inputs and outputs. Using the proposed approach, optimistic, pessimistic and integrated renewable energy performances of entities with carry-overs are assessed for each period and generally. The empirical findings reveal that the proposed FDDDF approach has strong capability to discriminate the performance of renewable energy.

Comparison of Women’s Labor Market Participation between Types of Childcare Policies Based on Policy Tool Mix

This study examines the effect of state-centered childcare policies on women’s labor market participation. It applies the fuzzy-set qualitative method to OECD member countries and classifies countries into seven types based on the mix of childcare policy tools in terms of the state’s directness of funding, directness of service creation, and coerciveness of service quality regulation. This helped identify an effective combination of childcare policy tools for increasing women’s labor market participation. Thus, providing childcare services that policy consumers can trust by increasing the government’s enforcement of qualitative regulations on childcare services is critical.

The importance of public sector size and resources volatility in carbon emissions: Empirical evidence from OECD countries

Natural resources and environmental depletion are significant concerns for both developing and developed nations. Those challenges not only surge environmental risks but also result in extensive financial damages, leading to the provision of substantial funds each year for carbon mitigation strategies. The present study aims to inspect the impact of public sector size and natural resource volatility on environmental depletion by evaluating panel data from twenty OECD member countries. Based on data availability, the selected time frame for analysis is 1995–2021. The study employs the Augmented Mean Group (AMG) approach to address potential biases arising from cross-sectional dependence (CD) and slope heterogeneity. The findings depicted a positive relationship between public sector size, natural resource volatility, and carbon dioxide (CO2) emissions in selected OECD countries. The results underscore that an increased share of government expenditures and high natural resource volatility contribute to carbon emissions. These outcomes highlight the need to condemn the highly volatile consumption of natural resources to bring stability in the resources markets and also condemn irresponsible financing of environmentally unfriendly projects for the sake of a healthier environment. The study proposed that governments should pay attention to prioritizing environmental quality when utilizing natural resources or allocating funds across various sectors.

Benchmarking countries' technical efficiency using AHP-based weighted slack-based measurement (W-SBM): A cross-national perspective

ObjectivesThe objective of the research is to assess the technical efficiency of national health systems in OECD member countries and to provide ideas to improve the efficiency of health systems in countries that have been identified as having a lower degree of efficiency as a result of the findings. MethodsThe technical efficiency scores were calculated using one of the data envelopment analyses (DEA), the Weighted Slack-Based Measure (W-SBM). The Analytic Hierarchy Process was used to establish the aforementioned weights (AHP). Weights are calculated separately for both input and output variables. ResultsThe technical efficiency of the relevant countries' health systems is around 0.79, according to the data, and just 13 (36.1%) of the 36 countries have a fairly efficient health system. ConclusionsThe outcomes of the study were supposed to aid health policymakers and management in improving system efficiency. In addition, since the number of studies examining the health systems of OECD countries with the W-SBM method is limited, it is thought that this study will make an important contribution to the literature.

OECD Ülkelerinde Satın Alma Gücü Paritesinin İncelenmesi: Doğrusal Olmayan Yapısal Kırılmalı Birim Kök Testinden Yeni Kanıtlar

This study aims to investigate the purchasing power parity (PPP) hypothesis for 38 OECD member countries over the period 1994:M1-2021:M9 by performing Hepsag’s (2021) unit root test. It fills the gap in the literature since it is one of the first studies conducted performing a unit root test that considers structural change and nonlinearity for all OECD countries. The study, in which conventional unit root tests such as the ADF, KPSS, and the Fourier KPSS, which allow merely structural change, yield conflicting results regarding the validity of the PPP hypothesis, determines that the PPP hypothesis is valid for countries with stationary real effective exchange rates at the level such as Finland, France, Germany, Greece, Hungary, Iceland, Italy, Japan, Korea, Lithuania, Luxembourg, Mexico, Norway, Slovakia, Slovenia, Spain, Switzerland, Turkey, and the USA according to Hepsag’s (2021) unit root test results.

Studying tourism recovery options under economic constraints: does stakeholder engagement and financial stability matter?

Researchers neglected the relevance of combining tourism with stakeholders' engagement and financial stability for unlocking the economic constraints. For this, current research intended to study the interplay of tourism recovery options under economic constraints with the role of stakeholders' engagement and financial stability. According to our data, China outperforms the other OECD members. The results shown that Russia comes in second with a consistent in tourism recovery, financial stability, and stakeholders' engagement; Indonesia and Turkey, which finished fourth and fifth in the rankings, have good tourism recovery prospects. Mexico and Brazil come in second and third, respectively, with the worst performance and the lowest scores recorded in the survey findings. The overall interplay among the variables was empirically produced based on the findings of this study and is a new inclusive assessment of financial stability and tourism recovery parameters. It is a useful tool for policy development and evaluation. This study also addresses the criticism of load selection at random and accurately depicts the entire scope of fiscal intervention in the economy to prudently enhance tourism recovery at large.

Which Members of OECD are Inactive or Laissez-Faire at Reducing Greenhouse Gas Emissions

Which Members of OECD are Inactive or Laissez-Faire at Reducing Greenhouse Gas Emissions

Role of economic complexity and government intervention in environmental sustainability: Is decentralization critical?

While climate change mitigation agenda and energy governance are the central concerns of climatologists and energy-environmental scientists, the mainstream literature seems silent on whether a decentralized governance structure is desirable for complex economic systems and governmental intervention approaches to realize sustainable environments. To frame this critical research gap, we investigate the contribution of fiscal decentralization in moderating the influence of economic complexity and government intervention on energy and carbon efficiency in the presence of real GDP per capita. We employ a panel method of moments quantile regression (MQR) on data from selected seven fiscally decentralized OECD countries over the 1995–2018 period. The empirical results uncovered that economic complexity causes a drop in energy efficiency (at 1, 5, and 10% significance levels), with a more magnified effect in countries with low environmental sustainability levels. Conversely, our findings exerted that government intervention discourages energy and carbon intensity (at diversified significance levels as per probability scores of 0.01, 0.05, and 0.10), with heterogeneous degrees of impact across diversified model specifications. Regarding direct influence, our outcomes exhibited that expenditure and revenue decentralization aid in energy and carbon efficiency. Concerning moderation effects, expenditure and revenue decentralization successfully rejuvenate the environmental sustainability effects of economic complexity and government intervention (at 1 and 5% significance levels). Finally, our study gauged that the EKC phenomenon exists among the sampled OECD members, indicating that economic growth in the region will be the driving force behind the region's long-term environmental sustainability. Estimation results are robust to the alternative dependent variable, carbon intensity and alternative econometric technique, ordinary least squares with Driscoll-Kraay standard errors. A fiscally decentralized paradigm is desirable from a policy standpoint for government intervention in complex economies to realize environmental sustainability goals.