SESSION 6

INCLUSIVE GROWTH:

OVERVIEW OF THE

WORK AHEAD

New Approaches to Economic Challenges

NAEC Group Meeting, 28 November 2014

Lamia KAMAL-CHAOUI SENIOR ADVISOR TO THE SECRETARY-GENERAL

INCLUSIVE GROWTH INITIATIVEA Central Contribution to NAEC

Traditional economic growth

models in question

Levels of inequalities were brewing pre-2007

Inequalities increased almost

everywhere during periods of

sustained economic growth

Did not distribute benefits and opportunities fairly

New Approaches to

Economic Challenges

A core objective

is to develop a

strategic policy

agenda for

sustainable,

inclusive growth

Launched at the end of 2012

A response to rising inequalities

Building on longstanding OECD work on inequalities,

well-being and pro-growth structural policies.

LAYING THE FOUNDATIONS: Preliminary Work Phase

• During its preliminary work phase (2012-14) the IG Initiative delivered:

Report on the OECD Framework for Inclusive Growth to Ministers at the 2014 MCM

Publication on IG, presented at the OECD Forum 2014: All on Board: Making Inclusive Growth Happen

KEY DELIVERABLESReport on the OECD Framework for Inclusive Growth

A three-pronged approach:

Multidimensional

• Accounts for income and non-income related outcomes (presently employment and health)

Distributional

• Considers groups of households like the middle class or the bottom 10, 20, 40 %

Policy Actionable

• Establishes quantitative links between multidimensional outcomes and key policy variables to allow policy makers identify synergies among policy levers and take compensatory action when there are trade-offs

KEY DELIVERABLESAll on Board: Making Inclusive Growth Happen

• Overview of trends in inequalities

• Introduces the OECD Multidimensional Living Standard Measure

• Provides win-win policies that deliver both strong growth and greater inclusiveness in a wide range of policy areas

• Set outs the political governance requirement for the design and implementation of IG policies

KEY DELIVERABLESExternal Experts Group & Consultative Process

• External Experts Group

Guides and informs analytical work

Includes high-level experts from academia, the private sector, civil society, foundations and international organisations Sir Tony Atkinson - Honorary Fellow, Nuffield College,

University of Oxford

Mrs. Teresa Ter-Minassian – Economist, Former Director of Fiscal Affairs, International Monetary Fund

Kemal Dervis,– Vice President and Director, Global Economy and Development, The Brookings Institution

Prof. Philippe Aghion - Robert C. Waggoner Professor of Economics, Harvard University

KEY DELIVERABLESConsultative Process

• Consultative ProcessTwo International Workshops

(Paris, Apr. 2013; NY, Feb. 2014)

One Regional Consultation (LAC)

One National Consultation/Case Study (China)

KEY DELIVERABLESCommunications

• Launch OECD Inclusive Growth website

www.oecd.org/inclusive-growth

• Produce two videos Make Growth Inclusive to Tackle Rising

Inequality (Apr. 2013)Making Growth Inclusive (Feb. 2014)

• Deliver over 20 speeches on Inclusive Growth (by the Secretary-General)

• Publish articles on Inclusive Growth

STRENGTHENING OUR BASEA Four Pillar Approach for 2015-16

1. Methodological Refine and test the robustness of the IG Policy Framework

2. Sectoral Mainstream the IG approach across the sectoral work

3. National Test relevance of IG approach to a broad range of countries,

including emerging economies and developing economies, and put the framework into action

4. Regional Broaden the applicability of the IG Framework and expand the IG

database to emerging economies and developing countries

STRENGTHENING OUR BASEMainstreaming

• Further sectoral work is planned for 2015-16

Innovation (STI)Health (ELS)Education & Skills (EDU)Urban air quality (ENV)Inclusive Cities (GOV)And more…

STRENGTHENING OUR BASEMainstreaming

• NAEC projects are important contributions to the horizontal project

A. Reflection & Horizontal Scanning

B. Policy Trade-offs & Complementarities

C. Institutions and Governance

Deliverables before end 2014

B6 - Closing the loop: How inequality affects economic growth and cohesion? B3- Assessing the transitional costs and distributional consequences of structural

Deliverables planned to be finalised before 2015 MCM

B1 - New approaches to analysing multidimensional well-being: B8-Trade-offs and synergiesTrade-offs and synergies between environment and inequality

C1- Revisiting the social contract: Rebuilding trust for sustained economic recovery

Deliverables planned to be finalised after 2015 MCM

C5- Promoting IG through better regulation.

ENSURING CHECKS AND BALANCESInclusive Growth Governance

• Core Committees (CSSP, WP1/ECO, ELSAC) Vet substantive contributions, especially methodology

• Sectoral Committees (CTSP, EDPC, TDPC, EPOC, etc) Vet substantive contributions to sectoral work

• NAEC Group Serve as sounding board for substantive work

• Internal Inclusive Growth Focal Points Generate substantive inputs pursuant to achieving the horizontal

project’s overarching goals

• External Experts Group Provide ongoing guidance

MAKING INCLUSIVE GROWTH HAPPENTimeline for IG Horizontal Project

2014

•Finalise programme of work (POW)•Calendar of events•Communications strategy•Website development

2015

•Pillar 1: Update of the methodological and policy framework (timespan, countries, dimensions, distribution)•Pillar 2: Joint OECD/ADB/ESCAP Regional consultation with Southeast Asia •Pillar 3: Sectoral analysis •Pillar 4: National case studies •Consultations and communication•Progress report to 2015 MCM

2016

•Pillar 1: Continue refinement to methodology (finalisation of Policy Framework) •Pillar 2: Sectoral work•Pillar 3: Continue to pursue national case studies•Pillar 4: Possible Regional Consultation with MENA region/Africa•Other: Consultations and communications •Report to 2016 MCM

SUSTAINING MOMENTUMWinning the Battle Against Inequalities

• We need your continued support to keep the momentum going!

Continue to provide inputs and share your knowledge

Maintain interest on Inclusive Growth in your Capitals through outreach and awareness raising

Mobilise resources to deepen work on Inclusive Growth

STAYING INFORMED

Inclusive Growth Contact Information

• Online

www.oecd.org/inclusive-growth

InclusiveGrowth@oecd.org