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The potential growth impact of structural reforms in the EU. A benchmarking exercise

Author(s): Janos Varga, Jan in 't Veld

The potential growth impact of structural reforms in the EU. A benchmarking exercisepdf(5 MB) Choose translations of the previous link 

Summary for non-specialistspdf(72 kB) Choose translations of the previous link 

This paper presents a quantitative model-based assessment of the potential impact of structural reforms in the EU Member States. By comparing structural indicators of labour and product markets, a gap is defined for each indicator relative to the 3 best performers. Scenarios are then simulated in which half the gap vis-à-vis best performance is closed, to avoid setting unrealistic and/or unattainable targets. The simulations show large potential gains in output and employment, raising EU GDP by 3 % after five years and 6% after ten years. While competitiveness gains are smaller under simultaneous reforms, higher demand effects help to support growth in trading partners.

(European Economy. Economic Papers 541. December 2014. Brussels. PDF. 40pp. Tab. Graph. Ann. Bibliogr. Free.)

KC-AI-14-541-EN-N (online) KC-AI-14-541-EN-C (print)
ISBN 978-92-79-35190-7 (online)ISBN 978-92-79-36156-2 (print)
doi: 10.2765/72085 (online)doi: 10.2765/81623 (print)

JEL classification: C53; E10; F47; O20; O30; O41

Economic Papers are written by the staff of the Directorate-General for Economic and Financial Affairs, or by experts working in association with them. The Papers are intended to increase awareness of the technical work being done by staff and to seek comments and suggestions for further analysis. The views expressed are the author’s alone and do not necessarily correspond to those of the European Commission.

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