Norway’s gender experience Euro area: Why solidarity matters Israel’s progress report Special focus: Policymaking and the information revolution No 293 Q4 2012 www.oecdobserver.org

OECD Observer celebrates 50 Meeting the global water challenge

Nestlé’s Aman Bajaj Sood (left) and farmer Harinder Kaur take part in a Farmer Water Awareness Programme provided near the Nestlé factory in Moga, India.

Through our Creating Shared Alongside our other CSV key > Public policy Value reporting, we aim to share focus areas of nutrition and > Collective action information about our long-term rural development, this year’s > Direct operations impact on society and how this report summarises Nestlé’s > Supply chain is linked to the creation of our response to the water challenge > Community engagement long-term business success. in five key areas:

Visit the CSV Section of our website for a complete report of our progress, challenges and performance in 2011 www.nestle.com /csv CONTENTS No 293 Q4 2012

READERS’ VIEWS 20 Combating terrorist financing in the 2 Corporate tax responsibility; Labour advice information age Rick McDonell, Executive Secretary, EDITORIAL Financial Action Task Force 3 From the information revolution to 21 Africa.radio a knowledge-based world Roman Rollnick, Chief Editor, Advocacy, Angel Gurría Outreach and Communications, UN-Habitat 22 Is evidence evident? NEWS BRIEF Anne Glover, Chief Scientific Adviser to the 4 Crisis drives up social spending–as tax President of the European Commission revenues rise; Soundbites; Economy; 24 News that’s fit to post Monique Villa, CEO of the Thomson Special Focus: Policymaking and the information Country roundup; Rebalancing act; revolution, from page 11 Pensions struggle; Plus ça change… Reuters Foundation From November 1962 26 Asia’s information revolution John West, Executive Director, SOCIETY Asian Century Institute 6 Women in work: The Norwegian experience 28 The changing art of language Sigbjørn Johnsen, Minister of Finance, René Prioux Norway 29 Found in translation 8 Israel reports progress 30 Ad sense Interview with Sharon Kedmi, Director Interview with Richard Huntington, Strategy General of the Ministry of Industry, Director, Saatchi & Saatchi Trade and Labor, Israel 32 How the world wide web was won Robert Cailliau, Computer Scientist and Co- SPECIAL FOCUS: POLICYMAKING Founder of the World Wide Web, and James AND THE INFORMATION REVOLUtION Gillies, Director of Communications, CERN Is knowledge management up in the air? Page 37 11-15 Policymaking and the information 34 Face to Facebook with civil society revolution Phil Evans, Senior Consultant, FIPRA 12 Mandela’s cell number 35 The OECD Observer story 14 Trading in facts 36 Beyond blogonomics Ken Ash Henry Copeland, CEO, Blogads 15 Education for policymakers and Pressflex.com Barbara Ischinger 37 Last word: Up in the air? 16 Managing information and communications Rolf Alter in a fast-changing world Lester Rodriques and Jim Black ECONOMY 17 Can big data deliver on its promise? 40 Policy can brighten the economic outlook Martine Durand Pier Carlo Padoan 18 Information society: Which way now? 41 Spanish immigrants A plea for euro solidarity, page 44 Andy Wyckoff 42 Energy efficiency: A true alternative 19 Getting to know each other: The OECD and Interview with Fatih Birol, Chief Economist Latin America and Director of Global Energy Economics, José Antonio Ardavín International Energy Agency (IEA)

Published in English and French by the OECD All signed articles and letters express the opinions of the EDITOR-IN-CHIEF: Rory J. Clarke authors and do not necessarily represent the opinion of SENIOR EDITOR: Ricardo Tejada the OECD. www.oecdobserver.org EDITOR/WEB: Loïc Verdier © OECD December 2012 Reprinted and translated articles should carry the credit line WRITER: Lyndon Thompson “Reprinted from the OECD Observer”, plus date of issue. Signed EDITORIAL COORDINATOR: Marie Francolin articles reprinted must bear the author’s name. Two voucher ISSN 0029-7054 EDITORIAL ASSISTANTS: Rose Foran, Laetitia Sieffert copies should be sent to the Editor. All correspondence should Tel.: +33 (0) 1 45 24 80 66 be addressed to the Editor. The Organisation cannot be respon- Fax: +33 (0) 1 45 24 82 10 LAYOUT: Design Factory, Ireland sible for returning unsolicited manuscripts. [email protected] ILLUSTRATIONS: André Faber, David Rooney, Stik PHOTO RESEARCH: Rory Clarke The statistical data for Israel are supplied by and under Founded in 1962 The magazine of the Organisation LOGISTICS: Jochen Picht the responsibility of the relevant Israeli authorities. for Economic Co-operation and Development The use of such data by the OECD is without prejudice ADVERTISING MANAGER: François Barnaud to the status of the Golan Heights, East Jerusalem and Israeli settlements in the West Bank under the OECD Publications 2 rue André Pascal Applications for permission to reproduce or translate all or parts terms of international law. 75775 Paris cedex 16, France of articles from the OECD Observer, should be addressed to: [email protected] The Editor, OECD Observer, 2 rue André Pascal, 75775 Paris, www.oecd.org cedex 16, France. Readers’ views

We welcome your feedback.

Send your letters to [email protected] or post your comments at www.oecdobserver.org or www.oecdinsights.org

President François Hollande at the OECD, Page 48 Corporate tax responsibility One has the impression that various forms of There’s a legal and new political theory that labour market flexibility seem to be considered 44 The euro: A message of solidarity corporations are as citizens (or persons): the by the OECD as sound advice, regardless Charles Jenkins, Writer, Commentator and implication being that corporations have of what specific country problems may former Director of Western Europe Country effective rights. A reflection of this is the exist. When times are good, when times are Analysis, Economist Intelligence Unit, London 2010 Citizens United ruling by the US bad, when inflation is low, when inflation is 46 Business brief Supreme Court. high, when profits are low, when profits are high, when unemployment is low and when OECD.ORG Along with rights come responsibilities–one it is high. It is as if a doctor were capable of 48 French President François Hollande at the of them being to pay your fair share of taxes. making a diagnosis, but only able to write one OECD For example, a US citizen (as well as a resident 49 Mexican President-elect Enrique Peña prescription. alien), is obliged to report all global income, Nieto at the OECD: A common vision; and pay taxes on that amount, with some There are many problems in Turkey, but Peru eyes membership; Competitiveness challenge deductions, including for taxes paid overseas– excessive protection of workers’ rights is not 50 Well-being priority; Video view: The blue even if you live abroad. This limits most of and has never been among them. And, creating economy; Totalled recall the tax advantages of establishing an income precarious work in the “formal sector” in 51 Recent speeches by Angel Gurría; New source or residence in a tax haven. order to entice a shifting of resources from ambassadors the “informal sector” is neither sound advice in In addition, higher income earners are subject 52 Calendar; Frankie.org terms of economic and social development nor to the Alternative Minimum Tax (AMT): in terms of strengthening democracy. BOOKS basically, if you earn above a certain income, 53 A calm look at social unrest; Still booming you can no longer exploit every tax loophole. The informal economy stems primarily from 54-57 New publications on OECD iLibrary failures of governance, not from protecting In theory, as with citizens, corporations are 58 Vive la réforme workers. Other European countries with better subject to similar tax constructs, but as the ORDER FORM…ORDER FORM labour laws and enforcement do not have a on-going debates over corporate tax avoidance larger informal economy; but a far smaller one. DATABANK demonstrate, the tax reality for corporations is 61 Emerging innovators; Study abroad far different than for persons. Turkey needs major reforms in labour laws to 62 Main economic indicators bring them up to ILO standards. It is extremely So, if corporations are people, why don’t they 64 Investment dries up; Take a walk difficult for workers to form trade unions pay effective minimum tax rates on global and the thresholds for collective bargaining income? discourage rather than encourage its practice.

Norway’s gender experience Euro area: Why solidarity matters Israel’s progress report Mark Feige Special focus: Moreover, reforms should encourage Turkish Policy in the Information World No 293 Q4 2012 www.oecdobserver.org Economist, Washington D.C employers to show respect for the human rights of their workers. Labour advice You paint a positive picture of Turkey’s It hardly seems reasonable to attack economy in terms of growth of GDP and the few remaining protections in law. employment (OECD Observer No 290-91, Jim Baker OECD Observer celebrates 50 Q1-Q2 2012). Nevertheless, the interview states Coordinator, Council of Global Unions that for the future of the Turkish economy, On the cover: New logo Comments and letters may be edited The 50th anniversary cover, which displays a collection of covers taken “labour market reform is key, especially to for publishing. Send your letters to from the OECD archives amid celebratory fireworks (and clockwork), encourage the shifting of resources from the launches the new, more contemporary OECD Observer logo. Created [email protected] by Design Factory, the new logo adopts the Gotham font used in the informal to the formal sector: a more flexible or post your comments at official OECD logo. It reinforces the magazine’s corporate identity, while labour contract is needed and minimum wage providing a strong continuity with the previous logo that has been with www.oecdobserver.org or us since 1998. ©OECD Observer/Design Factory setting should be decentralised”. www.oecdinsights.org

2 EDITORIAL

From the information revolution to a knowledge-based world

revenue, given the ever more complex manner in which tax bases, The information including profits, can be shifted among countries. These are the kinds of fundamental policy issues the OECD is revolution addressing. And as a knowledge hub in which information is provides us with an currency, our organisation is fit for purpose. The information and technology revolution has brought improvements to every dimension opportunity to get of our work, transforming how data is gathered, managed, analysed, published, and disseminated, not to mention protected. ICT has it right provided us with the tools for a more constant dialogue and for bringing our member and partner countries closer together. And Angel Gurría thanks to ICT, the OECD not only diffuses more knowledge further Secretary-General of the OECD and wider than ever before, but it also infuses it with fresh and constantly evolving knowledge from people outside the organisation, To mark the occasion of the 50th anniversary edition of the using interactive tools, wikis and public forums, for instance. OECD Observer, we take a brief look at how the information world and the global economy have transformed since the OECD’s first The information world evolves quickly. The first SMS text message secretary-general, Thorkil Kristensen, launched the magazine in was sent in December 1992. Just 20 years ago! Now mobile November 1962. communications have permeated every continent. Social media is far younger, yet it is already ushering in a new age of big data. In fact, In the last two decades we have lived through a veritable information as this edition points out, more data was produced in 2011 than in revolution that has changed the world forever. Have these changes the whole of human history. improved our lives or made our work easier? The answer is: yes, but! The OECD is investing in the knowledge management tools it Take the Internet. Breakthroughs in information and communication needs to stay ahead of these trends. But as human beings, we must technologies (ICT) have enhanced access to markets, spurred also stand back from the plethora, ask questions, discuss and make innovation and created new business opportunities. Technologies informed judgements. contributed to progress in energy, education, food and health, improving the well-being of a larger number of people worldwide. The first edition of the OECD Observer opened with an article called They have also helped emerging economies to become global “What makes an economy grow?” In light of the worst crisis in our powerhouses and locomotives of the world economy. lifetimes, we are still seeking a satisfactory answer to that question. We have never had so much information, yet we failed to anticipate, The information revolution has changed the way our economies let alone, prevent the financial crisis from happening. function and laid the foundations of a knowledge-based world. It is on this new landscape that policymakers should focus more On the contrary, critics argue that the information revolution has of their attention. been a cause of our instability. Its speed leads to volatility–from high frequency trading in financial markets, for instance–while it conceals In today’s knowledge-based economy, wealth comes more and more channels for corruption and illicit financing. Serious concerns about from ideas and innovations embedded in products and services. The privacy add to a widespread sense of mistrust. assets and competitive advantages of firms or countries are rooted in research and development (R&D), software and brands, organisation The OECD takes these challenges seriously and is determined to and production structures, and many other “intangible” assets. combat abuse and promote the knowledge and confidence that we believe the information revolution promises. Moreover, in this knowledge-based economy production is spread around the world, involving countries of different income levels, Building better policies for a world based on inclusive, sustainable research and development networks, design and marketing, growth is paramount, and through our major New Approaches to assembly lines, and customer support. Without ICT, it would be Economic Challenges initiative launched in 2012, we have begun to difficult to integrate all these stages of production to create global probe and question our growth models, and explore new paradigms value chains. that incorporate equity and the environment.

Gaining a foothold in global value chains has understandably It is a vast “knowledge” endeavour, which depends on cooperation. become a preoccupation of policymakers, given the need to look for By harnessing knowledge and ideas skilfully and openly, we can build new, dynamic sources of growth after the crisis and to build more a brighter future. The information revolution provides us with an robust economies. Moreover, competition for investment high up the opportunity to get it right. value chain highlights the importance of education, skills and R&D. And these developments challenge the way we look at trade, invest www.oecdobserver.org/angelgurria in education and skills of our citizens, and prevent an erosion of tax www.oecd.org/secretarygeneral

OECD Observer No 293 Q4 2012 3 News brief

–as tax Soundbites revenues rise Hope of the ages “We began the year in the valley Tax revenues in most OECD countries of recession–we completed it on the are again on the rise. This follows high road of recovery and growth.” declines seen at the beginning of the John F. Kennedy, State of the Union Address, crisis. The OECD’s annual Revenue 11 January 1962 Statistics shows that member countries End of growth? collected some 34.0% of GDP in taxes “Growth is not just a product of in 2011, compared with 33.8% in 2010. incentives. It depends even more This is still well below the most recent

©Shannon Stapleton/Reuters ©Shannon on opportunities. Rapid increases in 2007 peak of 35.1%. productivity at the frontier are possible Crisis drives up only if the right innovations occur.” Chile, France, the Czech Republic and Martin Wolf, Financial Times, 2 October 2012 Germany saw the largest increases in social spending– 2011, and Hungary, Estonia and Sweden Euro optimism Crisis-fuelled increases in unemployment the largest falls. “The euro’s rescue is on track” and income support benefits combined Editorial in French daily, Le Monde, 1 October 2012 with stagnating or declining GDP has Several factors explain the increasing tax ratios in 2010 and 2011. Under pushed public social spending up. A new Love tax progressive tax regimes, economic report, Social Spending after the Crisis, finds “These days, few people are willing to recovery led to tax revenues rising that spending has climbed to an average extol the glories and virtues of taxation, of 22% of GDP across the OECD in 2012, faster than GDP. At the same time, but this discovery would not have up from 19% in 2007. In fact, real social many countries raised tax rates and/or happened without the tax payer. In spending has risen on average by around broadened bases. In 2008 and 2009, fact, the vast majority of the planet’s 10% since 2007-2008 after prices are the declining ratios reflected the severity taxpayers had skin in the game.” taken into account. of the recession and the fact that some Paul Tipton, Professor of Physics, countries responded by cutting tax rates. Yale University, writing about the discovery of the Higgs Boson particle, Los Angeles Times, Real social spending has fallen in only two 9 July 2012 countries–by 14% in Greece and 13% in www.oecd.org/tax Hungary. Spending rose most in Korea where a 29% increase reflected spending on pensions and other benefits such as Economy childcare. France spends most on social US. The leading indicators for Japan, policy, at 32.1% of GDP, followed by Provisional growth estimates show that Germany, France and the euro area as quarterly gross domestic product (GDP) a whole continue to look weak (see page 38). Denmark (30.2%) and Sweden (29.8%). in the OECD area rose by 0.2% in the third quarter of 2012. This was the same Annual inflation in the OECD area rose Population ageing will also drive up rate as in the previous quarter, but with by 2.2% in the year to September 2012, pension and health spending in the years continuing diverging patterns across up from 2.1% in the year to August ahead. The challenge now, the report says, countries. In the US, growth accelerated 2012. This slight increase in the annual is to safeguard social support for future to 0.5%, compared with 0.3% in the second rate of inflation was driven by higher generations. Public social spending on the quarter. In the UK, growth boosted to 1% energy prices which accelerated to 5.1% elderly amounted to 11% of GDP in 2009. compared with a contraction of 0.4% in in September, up from 3.5% in August, The proportion of elderly in the population the previous quarter. Growth also picked while food price inflation slowed to 2.1% is around 15% across the OECD but on up in France to 0.2%, compared with a in September, compared with 2.2% in decline of 0.1% in the previous quarter. August. Excluding food and energy, the average they receive 40% of all public OECD annual inflation rate slowed to 1.6% social spending. In Japan and Italy, where Leading indicators from the OECD, which in September 2012 compared with 1.7% senior citizens make up about 20% of the help anticipate turning points in economic in August. population, the share swells to 60%. activity, continue to point to weak growth prospects. However, signs of stabilisation The OECD area unemployment rate was www.oecd.org/els/social/expenditure are emerging in Canada, China and the 7.9% in September 2012, broadly the

4 NEWS

Country roundup Rebalancing act The balance of economic power is Denmark should build on the strengths expected to shift dramatically over the of its vocational and educational training next half century. Fast-growing emerging- programme to ensure that young people market economies will likely account enter the labour market with the skills for an increasing share of global output, companies need and to meet the national according to a new OECD report. goal of having 60% of young people enter higher education by 2020, according to a Cortinat ©OECD/Hervé OECD Secretary-General Angel Gurría and French Divergent long-term growth patterns new OECD report. President François Hollande at the OECD in November. will lead to radical shifts in the relative See the oecd.org section, page 48 size of economies. The United States is Estonia recovered strongly from the global expected to cede its place as the world’s economic crisis but growth has since standards, according to the OECD’s Health largest economy to China, as early as 2016, slowed, highlighting the need for further Care Quality Review of Israel. though living standards will still only be reforms that reduce exposure to external 60% of that in the leading countries in shocks and ensure against future boom/ Ghana has signed the Convention on 2060. India’s GDP is also expected to pass bust cycles, according to the OECD’s latest Mutual Administrative Assistance in that of the United States over the long Economic Survey of Estonia. Tax Matters, a multilateral agreement term, but its per capita income will only be developed jointly by the Council of Europe about 25% of that in advanced countries. Finland should not back-track on its aid and the OECD. Ghana is the second commitments, according to the OECD’s African country, after South Africa, to sign Fast-ageing economic heavyweights, such Review of the Development Co-operation the Convention since it was opened for as Japan and the euro area, will gradually Policies and Programmes of Finland. While signature to all countries in June 2011. lose ground on the global GDP table to the country is making efforts to improve countries with a younger population, like its development co-operation, sharpening Tax revenues in Latin American countries Indonesia and Brazil. the focus of its efforts and emphasising as a proportion of their national income are the importance of human rights, success rising slowly although they remain lower www.oecd.org/economy is contingent on Finland honouring its than in most OECD countries. Revenue commitment to increase funding, focusing Statistics in Latin America shows that the on areas and countries where it can have average tax revenue to GDP ratio in the Pensions struggle the most impact, and improving the way it 15 Latin American countries covered by Pension funds in the OECD are losing manages development co-operation. the report increased from 19% in 2009 to steam. Though assets hit a record US$20.1 19.4% in 2010, after falling from a high trillion in 2011, return on investment fell Israel has world-class primary care services point of 19.7% in 2008. below zero, with an average negative return and should now focus efforts on bringing its of -1.7%, according to the OECD’s latest hospitals up to the same high international Visit www.oecd.org/newsroom Pension Markets in Focus. The September report says that weak equity markets and low interest rates drove the poor performance. same rate recorded since January 2011. In the euro area, the unemployment Consumer prices rise www.oecd.org/insurance rate increased for the 16th consecutive % change, September, year on year month–up 0.1 percentage point to 11.6% in Plus ça change… September–while it fell by 0.3 percentage OECD total point in the US in September (to 7.8%). 7.0 “Nobody has time enough to read all these publications, and nobody needs to know 6.0 Unit labour costs in the OECD area rose 5.1 everything about every specialised subject, but by 0.3% in the second quarter of 2012, 5.0 there are many people who do feel a need to driven by continued increases in labour 4.0 know something about some of the problems compensation per unit of labour input. 3.0 2.2 2.1 and to follow the work in a more general way. 2.0 1.6 This is why we are now issuing the OECD Merchandise trade continued to slow in 1.0 Observer, a new periodical.” most major economies in the third quarter 0.0 of 2012 compared to the second quarter of All items Food “The OECD Observer” by Thorkil Kristensen, 2012. Imports and exports fell in the third Source: OECD Energy All items, non-food, non-energy former Secretary-General of the OECD, quarter of 2012 in Brazil, Germany, Italy, in issue No 1, November 1962 Japan, Russia, South Africa, and the US.

Visit www.oecd.org/statistics

OECD Observer No 293 Q4 2012 5 Women in work: The Norwegian experience

Sigbjørn Johnsen, Minister of Finance, Norway ©REUTERS/Scanpix Scanpix ©REUTERS/Scanpix

In the last 50 years, there has been for health care. Low birth rates will add High female participation in the a tremendous change in women’s to the problem, and a shrinking working- workforce has a decisive effect participation in paid work in most OECD age population will have to provide for an on a country’s performance, as countries. Labour market participation has increasing number of pensioners. Higher Norway shows. been a key to economic independence for labour force participation and longer women. It has given women the possibility careers are important parts of the solution. Any country’s main asset is its workforce, to develop and use their professional skills. In addition to reforming pension schemes, and Norway, with its oil wealth, is no Employment among women is also crucial many countries now see a need to make exception. Sustainable policies for low for economic performance. This may use of the large unused work potential unemployment and high participation prove especially important in the years among women. rates for women, men and young people to come, as an ageing population will place are predominant and the burden sharing an increasingly severe burden on public These countries face a double challenge: of the cost of the welfare state is carried finances. Old age pension expenditure to increase women’s labour participation on the back of the labour force. will increase, as will government outlays and to raise birth rates. To encourage

6 SOCIETY

women with children to go out to work, by moving the care of children and the Norway and the other Nordic countries elderly out of the family and under public have implemented policies that make it responsibility instead. easier to combine work and family life. I strongly believe that female employment The ideal of the housewife was strong has brought about large economic benefits in Norway in the 1950s and early 1960s. for Norway. Firstly, choosing workers from However, since the beginning of the 1970s, a pool of male and female workers, as the labour participation rate has risen opposed to choosing from a pool where from 44% to 76% for women between the half of the potential talent is excluded, ages of 15 and 64. Some 83% of mothers leads to productivity gains. Secondly, with small children are employed. Fertility higher female labour participation has rates have risen along with the rise in led to productivity gains through a higher labour participation, from 1.75 children degree of specialisation. And finally, per woman at the end of the 1970s to 1.9 children per woman today–one of the A higher labour supply means higher highest fertility rates in Europe. income from tax, which in part can be

There are several drivers behind this utilised to offer more comprehensive development. First of all, the increase in public services female employment in Norway took place at a time when there was a rise in demand female employment has added more for labour, and alongside a remarkable workers to the work force at a time when boost in educational attainment among average work hours per employed person women. Secondly, employment among have been declining. Decreasing work women was stimulated by comprehensive hours for the employed has in part been a parental provisions and subsidised day- natural consequence of higher prosperity– ©Rune Kongsro care for children. In 1970 only 13,000 people’s priorities have changed as they Sigbjørn Johnsen, Minister of Finance, Norway Norwegian children were enrolled in no longer need to work as hard to make day-care centres. Today the number is a living. But with women entering the this picture has two sides. Without our about 280,000 with coverage of almost workforce, the contribution to growth relatively short business hours and the 90% of all 1-5 year olds. Parental leave from the work effort can be maintained. option of working part-time, the barriers for employed mothers and fathers is paid This contributes significantly to raising into work for women would have been from public budgets and has been the national income. much higher. The next step for Norway extended from 12 weeks 30 years ago will be to find ways to encourage people to 47 weeks today. Other measures are a In fact, if the level of female participation to move from part-time work to full- statutory right to paid leave to stay at in Norway were to be reduced to the OECD time work. With family provisions and home with sick children and a right to average, Norway’s net national wealth childcare already in place, we believe this work part-time until the youngest child would, all other factors being equal, fall is within reach. turns 12. by a value equivalent to our total petroleum wealth, including the value of assets held The Norwegian experience may not be The welfare state has in many respects in the Government Pension Fund-Global easily transposed to other countries. made women’s labour participation (GPG, formerly the petroleum fund). However, the challenges of more fully possible, but women’s own work effort This calculation assumes that the share utilising the workforce’s potential are has in turn been a precondition of the of females in part-time employment the same in most OECD countries. development of the welfare state. A higher remains unchanged. labour supply means higher income from References tax, which in part can be utilised to offer Labour force participation in Norway is Visit the Norwegian Ministry of Finance at more comprehensive public services. among the highest in the OECD. However, www.regjeringen.no/en/dep/fin.html At the same time a higher labour supply average yearly work hours per person See also www.oecd.org/norway and is also needed to perform these services. between the ages of 15 and 64 are now www.oecd.org/social/genderequalityanddevelopment Many of these services in turn allow for relatively low and substantially lower Norway will be chairing the 2013 Ministerial a higher female labour supply, for instance, than, say, in Korea. But as we have seen, Council Meeting from 29-30 May.

OECD Observer No 293 Q4 2012 7 Israel reports progress

first government centre for Haredim is do you see as being the next steps? being established, and additional centres As part of that learning process, the are already at approval stage. And let’s not government has recently established a forget our efforts to expand the support new position of Deputy Director General provided to working parents of young of the Ministry of Industry, Trade and Labor, children. My ministry is substantially who is in charge of developing the general increasing public day-care for children up employment policy of Israel. This enables a to the age of 3 with working parents. We horizontal view for more policy coherence, look forward to discussing these initiatives, which I believe is one of the core principles among other policies, at the OECD. endorsed by the OECD.

One issue you focus on in the report is In general, our collaboration with the OECD poverty, since in Israel there is a relatively has proven to be an important step in high poverty rate by OECD standards. What improving our public services, and not just new action has been taken to tackle this? in the field of employment. The next step Israel has a long-term strategy in place of that process should be peer learning and ©Government of Israel ©Government to tackle poverty. This strategy focuses benchmarking, rather than just meeting More than two years after Israel joined on improving educational achievement, standards. One of our goals in that sense is the OECD, Sharon Kedmi, director general facilitating access to higher education to increase the participation of the ministry of the Ministry of Industry, Trade and Labor, especially for disadvantaged groups, in ongoing work and voluntary projects led a delegation to an important OECD improving infrastructure in remote areas of which will assist us in improving our policies. Employment, Labour and Social Affairs the country and encouraging participation Committee meeting on 26 October. in the labour market. Let me mention two recent examples of He spoke to the OECD Observer. such voluntary initiatives. First, there is the A significant move has been to implement country review on vocational training being When you joined the OECD in 2010, Israel the Earned Income Tax Credit (EITC) conducted as part of the “Skills Beyond was asked to address several outstanding nationwide and increase the credit level School” project. The review will make policy social and labour market challenges. You for targeted populations. An EITC was first recommendations on how to strengthen are now submitting a detailed 200-page introduced as a pilot programme, and in our vocational education and training progress report. What in your view are the 2011 it was expanded to cover the whole regime. And second, an OECD workshop highlights of that progress report? country. The expanded deployment of the on regulatory enforcement and compliance The integration of populations with EITC increased the potential number of inspections took place in Jerusalem on 29- low rates of participation in the labour eligible recipients from 100,000 in 2010 30 October, hosted by our ministry. market, such as Arab-Israelis (especially to 420,000 in 2011. women) and the ultra-orthodox Haredim As part of our efforts, the ministry has (especially men), has been one of the Another illustration is the enforcement designated a counsellor to the Israeli prominent challenges that Israel is making of rights, particularly of our labour laws. Permanent Delegation to the OECD. Her an increasing effort to address. It was This has been given special attention team will strive to enhance our ministry’s one of the main issues raised during our by the government and even found input into OECD work across a range of accession to the OECD. In the progress expression in one of the recommendations policy domains. report we present a detailed list of our major of the Trajtenberg Committee* on socio- initiatives that have been implemented or economic challenges. The ministry has *A government-appointed commission was set up in August 2011 to examine and propose solutions approved by the Israeli government since worked to strengthen the capabilities of to Israel’s socio-economic problems. It is headed by 2010. The various initiatives contributed to the law enforcement system, first, by Manuel Trajtenberg, who chairs the Higher Education the increase in employment rates (up 2.4% initiating a law aimed at enhancing the Planning and Budget Committee. for Arab women and up 6% for Haredi enforcement of the labour laws, with Visit the official website of the Ministry of Industry, men from 2008 to 2011) and will continue the full co-operation of the employer Trade and Labor of Israel, at www.moital.gov.il to do so in the years to come. organisations and the Histadrut, Israel’s State of Israel (2012), Progress Report on the Implementation of the OECD Recommendations: trade union organisation; and second, by Labour Market and Social Policies. A clear illustration of our efforts is the adding 120 positions to law enforcement “Israel’s economic strategy: An interview with Yuval establishment of a network of 21 dedicated over the course of the next two years. Steinitz, Minister of Finance of Israel”, employment centres that provide an in OECD Observer No 284, Q1 2011. extensive array of employment services You describe the progress report as a www.oecd.org/israel for the Arab population. In addition, the milestone in the learning process. What

8 Business brief

The Long-Term Investors’ Club A global platform of major investors

The need for long-term investment is more urgent than ever given the from the G20 and OECD countries, representing a combined balance rapid changes our societies are undergoing. sheet total of US$3.2 trillion.

Responding to major challenges, such as shifting to a low-carbon economy The Long-Term Investors’ Club is a member driven and project oriented or supporting sustainable urban development and infrastructure building, organisation. will require massive financial resources. Among the first achievements of the Members: • two major equity investment funds Since many of our national budgets are constrained by the current • the Marguerite Fund, that supports strategic investments in the financial and economic crisis, there are now few options other than fields of energy, climate change and transport infrastructure in the adopting the regulatory frameworks to incite long-term investment EU’s 27 Member States; and encouraging cooperation between long term investors to take up • the InfraMed Infrastructure Fund; dedicated to long-term investments these challenges. in sustainable transport, energy and urban infrastructures in the countries of the Mediterranean’s southern and eastern shores. This is the mission of the Long-Term Investors’ Club (www.ltic.org). These equity funds are prototypes of new financial instruments, combining public and private investors to finance long-term Founded in 2009, the Long-Term Investors’ Club aims to bring together investments. They have both realised their first investments and major worldwide institutions–including sovereign wealth funds, public expect to reach final close in the coming months. sector retirement funds, private-sector pension funds and development banks–to assert their common identity as long-term investors and to • Active contributions to European and international debates on the facilitate greater cooperation between members. regulatory framework applicable to long-term investment (Basel III, IFRS, IASB standards, OECD work on long-term investment, etc). The Long-Term Investors Club is today composed of 14 major financial institutions and institutional investors from all over the world, in particular See www.ltic.org

OECD Observer No 293 Q4 2012 9 BETTER POLICIES FOR BETTER LIVES OECD Internet Economy Outlook 2012

Browse and order at www.oecd.org/bookshop POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS S pecial Policymaking and the information revolution ©Larry Downing/Reuters US President Barack Obama’s first Twitter Town Hall, 6 July 2011

The OECD Observer is celebrating its 20 years alone, breakthroughs in care, energy, communications, transport th 50 anniversary: no better time than all manner of information and and more? to turn our focus to the currency of communications technologies have information itself. quite simply transformed the global What about policymaking? Has the landscape. The surge of countries such information revolution made the job of This special edition is not about the as China and Korea, renewed interest in government any easier? Or are decision information society itself or the latest makers in a tougher position in today’s cool application. We take a step back and Has the information revolution made faster, information-rich environment look at some of the promises, challenges than they were before? From handling the job of government any easier? and risks that the information revolution the right sources and advice to making brings to people, their work and their lives. announcements and rallying support, has Historically there has never been so much Africa, as well as booms from Ireland to the game changed, if not the rules as well? information and data produced as there is the US (at least, until the 2008 crisis), now, but are people better informed or able owe much to the information revolution Nothing new under the sun? to lead better lives? and what it has unleashed in terms of The world has seen several information knowledge, capabilities and potential. In revolutions in the past, and the current How times have evolved since November 1980 US writer Alvin Toffler foresaw a one is certainly not the last. Think of 1962 when Thorkil Kristensen, the OECD’s coming “third wave” of societal change; scrolls and government bulletins issued first secretary-general, launched the OECD could that wave have already passed by, in Roman times, tipao news sheets Observer. In fact, in the last with new waves forming, affecting health during China’s Han dynasty, or modern

OECD Observer No 293 Q4 2012 11 FOCUS FOCUS S pecial S pecial

newspapers, which first appeared in widely, but lacked things like interactivity Europe in the 1600s. The following 200 and information management. They Cell number years brought more global changes. As had few, if any, workplace applications, Emma Rothschild wrote in the OECD apart from listening to your favourite Observer in 2003, “There has been a radio show! ‘revolution in commerce, in the power of nations, in the customs, the industry and Several factors make the latest revolutions the government of all peoples.’ Continents different: the instant speed and compression are connected as though by ‘flying bridges of space and time; the shift away from of communication.’” She was citing paper to online, allowing for a greater Abbé Raynal, an 18th century political pervasiveness, and invasiveness, of commentator, writing in 1770. information; interactivity; the ability to store, process and manage information; Is it different this time? Probably yes. and a convergence of platforms–people In Raynal’s time, globalisation was a slower listen to the Internet now! affair, with dispatches taking several weeks to cross oceans and continents, though And there’s more. As former OECD chief news of royal births and revolutions were economist, Ignazio Visco, wrote in 2002, nevertheless greeted as hot news. “the dramatic fall in communication costs

[…] and the technological breakthroughs Philpott/REUTERS©Hugo th Then in the 20 century came radio and behind it, have led to a diffusion of ideas, South Africa’s former president, Nelson Mandela, television. President John F Kennedy technological know-how and a general holds up a mobile phone in London, 21 October lauded the power of television to shape spread of information at a pace that is 2003. Using his old convict number 46664 from quite unprecedented in the history Robben Island, Mr Mandela helped launch a global phone and internet campaign to raise awareness Digital information world is accelerating of humankind.” about AIDs. Originally published in OECD Observer and reinventing itself via mobile No 240/241 December 2003 Great expectations applications and big data When the OECD Observer emerged competing for attention and making in those post-war decades, divulging decisions in an information world where politics by subjecting political figures to information to the public was a delicate fundamental choices can be obscured the scrutiny of a public “able to detect… exercise. After all, as the first editorial by tweets and Facebook “likes”. This deception and… willing to respect political pointed out, it was in an atmosphere special anniversary edition of the OECD honesty.” of confidentiality that political results Observer takes a brief look at just some of were obtained. these challenges. When Fannie Lou Hamer stood before television cameras at the 1964 US A Cold War veil of paranoia hung over Power tech Democratic Convention and delivered her many proceedings, which the new “Four more years.” When Barack Obama famous “Is this America?” speech, some magazine helped to lift: as Kristensen won his 2nd term as US president, he 90% of US households had televisions, wrote, “a step was taken towards a wider tweeted this announcement of his victory. compared with 54% a decade earlier. An dissemination of this [organisation’s] It became the most read tweet of all time. uncomfortable President Lyndon Johnson knowledge.” tried to distract attention by calling a Indeed, President Obama, whose press conference during the live showing, Today, two decades after the fall of the campaign in 2008 had also leaned on but the evening broadcasts would go out Berlin Wall and the rise of the Internet, the Internet, had 24 million followers on anyway. It was the first time that a black people’s expectations have changed. Twitter at the time of writing, and was civil rights activist addressed the nation in Openness has become standard, as has the only politician in the top 20, the rest her own words and through the medium instantaneousness. The digital information being personalities from the sports and of television. Having judged Mrs Hamer’s world is accelerating and reinventing itself entertainment worlds. But information is sentiments as honest, the viewing public via mobile applications and big data. power, and many other politicians around thrust the civil rights movements to the Such changes bring challenges for the world also have Twitter accounts. forefront of American politics. managing information and knowledge, Radio and television brought a whole sorting noise from substance, ensuring Social media featured in the 2012 French new potential to transmitting information effective infrastructures are in place, elections, and has made its presence felt

12 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial

more generally in politics worldwide over their anger was directed at the WTO, the Moreover, mobile technology has enabled the past year or two. Moreover, politicians city of Seattle declared itself an “MAI-free multiple campaigns and “flash mobs” to are turning to mobile applications to zone”. Faced with vocal and articulate campaign on any issue. garner data and check trends. opposition, led by people such as Public Citizen’s Lori Wallach, and with discords Could NGOs now be suffering from these Mastering new forms of communication starting to bubble among the negotiators new tools? Perhaps, for as Phil Evans has become indispensible to all those themselves, the MAI was shelved. writes in this edition, soft protest online seeking power or to influence policy, and via clicks cannot replace organised civil not just politicians. Labour unions, non- Beyond the detail, what people (and not campaigns. Even if the jury is still out governmental organisations (NGOs) and just NGOs) were clearly demanding on the effects of the Arab Spring or the charities have seized the opportunities they was openness and dialogue in public Occupy protests of recent years, these offer, and international organisations such policymaking generally. Several demonstrate a new, less centralised type as the OECD have also had to adapt. organisations have since developed their of street demonstration that is not fully engagement with civil society, a prime controlled by the traditional standard One reason for this is the Internet, which example being the annual OECD Forum bearers of protest. Established political helped to spur globalisation, although it which has been a regular event on the parties, trade unions and NGOs seem also ignited protests against it. Take the global calendar since its inception in unsure about how to respond. If new Multinational Agreement on Investment 2000. The OECD Observer has published forms of governance are emerging, they (MAI) being negotiated at the OECD in far more guest opinion articles since could bring challenges, as well as qualities. the 1990s. In 1997, the Polaris Institute, that time, while blogs have flourished. a Canadian NGO, obtained a draft of the Public engagement has become a modus What about lobbies? Unsurprisingly, agreement and circulated the draft by operandi. these often prefer face-to-face meetings email, spreading it around the web like to Facebook, though this may also change. wildfire. Anti-globalisation movements Meanwhile, the information revolution Two of Washington’s biggest firms cultivate were flourishing at the time, and came has rolled on with smart interactive tools sizable Twitter followings. And beyond to a head at the 1999 World Trade allowing people to do more than just the traditional lobbyist, more think-tanks Organization (WTO) conference in Seattle, comment; through the OECD Better Life have come on the scene, adding their angle Washington. The turnout of more than Index, for instance, the public is helping to and agendas to key debates. According to 40,000 protestors surprised many. Though build the well-being metrics of the future. Anne Glover, the European Commission president’s chief scientific adviser writing in this edition, a real challenge is how to make sure the facts are not only heard, but lead to better policies.

Clearly, policymakers must take new communication technologies seriously. By 2018, mobile penetration is expected to reach 96% globally, which works out at about one mobile subscription per person on earth.

With almost no barriers to obtaining or exchanging information, people have come to expect a clear and immediate response from institutions. Many countries now have interactive e-government services, permitting citizens to interact with governments on everything from health and education to security and tax. Governments are even encouraging a more dynamic involvement, the emphasis on finding out what citizens want, rather than deciding what they need. New big data can

OECD Observer No 293 Q4 2012 13 FOCUS FOCUS S pecial S pecial

help get down to ever finer detail about those wants and concerns. Trading in facts In a 2012 magazine interview, Roy Temple Ken Ash, Director, OECD Trade and labour market and social protection Cassidy, head of one of Washington’s Agriculture Directorate policies, have contributed to economic biggest lobbying firms, said that political growth and new job creation, a more candidates must deal with more third- unified, coherent and convincing case party groups than they did 25 years ago: can be made. And our evidence is clear: “… as a candidate, you are much less the open economies grow faster than closed master of your domain”. Policymakers may ones; no country has ever grown in the spend less time at guesswork, but given long run by restricting trade; and active the sophistication of new technology, they labour market and social protection may end up spending more time trying to policies help to ensure that the benefits decipher the messages and trends in the are widely shared . din of voices. Popular wisdom would also suggest that Cyberspace is where the big questions “exports are good and imports are bad”. are being debated, but whether it is the Again, this is demonstrably not true. The harbinger of better outcomes remains

©Charles Platiau/Reuters reality is that you need to import in order to be seen. to export. By systematically disentangling Getting information and traditional trade data to identify where Nor is continued public trust a given. communications “right” has always value is added, we can paint a clearer The ability of information technology (IT) been a necessary condition for delivering picture of where income is generated, to hoover up minute personal details is sound policy advice; today, there are where jobs are created, and how large causing consternation, and the OECD many more possibilities to generate and bilateral trade imbalances are. Most is looking closely at the implications of to share evidence-based policy insights, trade today is in intermediate inputs. comprehensive data collection, particularly but there are also many more competing Increasingly, with the emergence of about consumers’ online activities. messages and messengers. Here are two global value chains, firms import world examples. class inputs that enable them to improve In fact, privacy and security are issues their productivity and competitiveness. the OECD has been addressing for 30 Public support for freer trade has Closing markets will in effect destroy years, with its guidelines on privacy and eroded in the wake of the economic the jobs that countries want so much to security of information systems now crisis, slow and uneven growth, and maintain. being standards among stakeholders and increased unemployment; some people policymakers everywhere. are advocating a return to protectionist Producing the evidence-based policy type policies. While the desire to be advice is only a start; getting the message Still, fighting abuse is a moving target for “protected” is understandable, it is also to the right people at the right time, and any organisation. As Rick McDonell, who unfounded; but simply asserting this is informing the wider public, requires heads the Financial Action Task Force, not convincing. By working with nine tapping into all corners of today’s which combats money laundering and other international organisations to information and communications world. illicit financing, suggests in this edition, compile available evidence on how trade the glare of public attention is not always openness, along with complementary www.oecd.org/trade an asset. IT has brought undoubted benefits, but the risks posed by new technologies must be recognised. and mouse game. The euro crisis has take time to form. The trouble is, some Twitter, Facebook, and even SMS texts can been a case in point, as sound political governments want to go further, and cause embarrassment, with politicians announcements reassure jittery markets are pushing to constrain the Internet getting into trouble as discreet (and one day, lose their effect the next, and with internationally-agreed rules. Other indiscreet) tweets end up as headline news. cause a scramble for new initiatives and governments are opposed to attempts another rifle of announcements. to hoist state-led controls on cyberspace, Everyone feels compelled to react in preferring to preserve the open, borderless, real time, which sometimes catches Clearly, new habits and an online culture, multi-stakeholder model that has driven policymakers and markets in a cat whether in policymaking or security, will the Internet’s success.

14 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial

What you don’t know can hurt you Changes in the information society have always been drivers of progress, but as Education for policymakers Rothschild notes in citing an 18th century critic, the politics of global information Barbara Ischinger, Director, OECD Directorate for Education were divisive “The eyes of the world have been blinded by publications”.

In a world where more data has been produced in a year than in all of history, are we about to face an unfathomable plethora of information?

Knowledge management is now a serious undertaking for organisations and governments, just as it is for businesses and households. New digital tools will help make sense of the mass of data and how to process and transmit it.

As knowledge is a public good, such

systems must also cater for future ©Christian Charisius generations. Building a reliable knowledge Checking an education blog? German Chancellor Angela Merkel bank is all the more challenging in an age where online pages are being deleted and information lost on unusable disks and Education is one OECD For policymakers we are now providing abandoned computer drives. As Deborah department that has embraced new environments for sharing evidence, Woodyard of the British Library wrote in the information revolution. benchmarking and networking. The the OECD Observer in 2003, Leonardo da skills.oecd interactive portal provides Vinci’s old notebooks can still be opened, While we still use traditional means of data visualisations and videos aimed but can your old floppy? getting our messages out to decision to help people understand the complex makers–through printed press releases, issue of acquiring and using skills Hopefully, future researchers will be able launch events and videos, for example– effectively. Our “educationtoday” to access today’s OECD Observer just as we recognise that there has been a blog provides global perspectives on they can a notebook by da Vinci. And huge shift in how individuals get their education, and the interactive OECD despite the swirling kaleidoscope of data information. Social media technologies Better Life Index shows how education and news, with luck they will be able to have now extended our outreach beyond can improve people’s lives. We’re also find what they want, and the time to read policymakers to civil society. We have disseminating more of our information it as well. embraced new technologies to create online, through education-in-focus Rory Clarke, Lyndon Thompson more ways of gaining access to our great briefs and a quarterly online newsletter. wealth of data and analysis. References In short, we’re making it easier for Woodyard Deborah (2003), “The great digital Social media is now an integral part of policymakers and our other stakeholders, information disappearing act”, in OECD Observer including school principals, teachers, No 240/241, December. our communication strategy. Beyond parents and students, to see our Fannie Lou Hamer (1917-1977),Testimony before the just acting as a means to disseminate Credentials Committee, Democratic National Convention, and access information, social media work and, we hope, benefit from our Atlantic City, New Jersey, August 22, 1964. has helped us to gather insights from expertise in gathering and analysing http://americanradioworks.publicradio.org/features/ outside the OECD, keep up-to-date on internationally comparable data and sayitplain/flhamer.html policies, solicit feedback and make insights on education. OECD/ITU (2011). M-Government: Mobile our interactions with our stakeholders Technologies for Responsive Governments Visit www.oecd.org/education and Connected Societies more transparent.

OECD Observer No 293 Q4 2012 15 FOCUS FOCUS S pecial S pecial Managing information and communications in a fast-changing world

Lester Rodriques and Jim Black, OECD Information available to officials around the world in touch with its network around the world. Technology and Network Services electronically. This helped decrease It provides all players with immediate, the volume of paper documents being accurate and timely information, to help shipped by post, thus reducing costs with conference organisation, registration and lowering the environmental impact. and scheduling. E-mail was introduced as a ubiquitous communications technology shortly Such demands are set to increase. Laptops, afterwards. tablets and smartphones are standard requirements today, but who knows Sophisticated IT systems, statistical what will be added tomorrow? Changing databases and analytical applications are demographics, the consumerisation of core to the evidence-based analysis carried IT and mobility, and the blurring of lines out by our statisticians, economists and between home and work life require a policy analysts. Authors create more than dynamic and evolving IT environment 12,000 official documents each year using to meet the demands of tomorrow. a guided authoring environment, and collaborative systems allow OECD staff Downloading a document is no longer and countries to work closely together. enough, as users must also be able to adapt ©Tim Wimborne/Reuters ©Tim it and share it with colleagues and friends. People create policy, but underpinning Moreover, the daily (and increasing) People want more video and voice too, and their work, and in some ways hidden demands of the organisation for faster often in real time. The adoption of social from view, is a well-developed, smart download, wider reach and newer media networks as business tools is taking information and communications applications must constantly be met. hold, as organisations engage stakeholders infrastructure. It is a fundamental driver The entire acquis of OECD Instruments, in strategic and product development. of progress. Acts, Recommendations and Bodies All of this contributes to the knowledge- building process the OECD thrives on. The OECD is, by definition, a form of The speed and volume of information social network. It links countries and In this fast-changing world where rapid people together. Its forums of policy are set to accelerate access to information is increasingly experts and national representatives enable important, all systems must be available people to meet, share, work together and databases are available online. The OECD 24/7. Basic factors such as electricity, pressurise each other to perform better as is known for its robust statistics, and in a cyber security, disaster recovery and economies and societies. fast and competitive world where people backups must be planned for. Energy want today’s data now, this demands state- use and efficiency go hand-in-hand with Managing this information world has of-the-art technology to collate, manage information and communications, and always been a challenge. In fact, in the and read the massive flow of data coming so does reducing the environmental early 1970s a call was made in the OECD in from statistical offices and other sources, impact of IT. Observer for an information policy to as well as publishing them in user-friendly, help society manage and be able to learn compelling formats. Developments in information and from the growing volume of information communications technology have at the time. Meetings are IT-intensive too, both markedly improved the quality of life in their preparation and their execution. and work of the OECD as they have But these challenges have multiplied with Over 50,000 delegates and experts from in millions of organisations, businesses information technology (IT). From the around the world come to the OECD and households around the world. early days of telex to IT communications every year to attend some 2,000 meetings. As we look forward to the next 50 years, systems and the Internet, speed is of the Our experts also attend meetings abroad. new trends will emerge, which will bring essence today. And the speed and volume All of this provides information which new opportunities for improving our of information are accelerating. must be gathered, processed and managed knowledge base and the way we gather, in easy-to-use, yet sophisticated databases. manage and diffuse our information so The OECD’s first On Line Information The OECD’s Event Management System that member and partner countries can System (OLIS) was introduced for (EMS) has streamlined the meeting build better policies for better lives. member countries in 1989, making organisation and management process OECD documents and information and has changed the way the OECD stays Visit www.oecd.org/general/olis.htm

16 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial Can big data deliver on its promise?

Martine Durand, Director, OECD Directorate of Statistics of our organisation, and we have built innovative, interactive tools to draw in 3 8 5 more and better information from the 5 2 6 public. This, in turn, feeds into improving 6 3 4 9 the policy recommendations we give to 2 5 1 7 8 governments. The OECD Better Life Index 4 5 is a good example of this. Launched in 2011, it is a user-friendly web application 3 that members of the public can use to compare the quality of life in different % 2 countries and to develop their own indexes = based on their tastes and preferences. 1 They can then share their indexes far + and wide, including with us at the OECD. Since 2008, the OECD has also - been employing its Wikigender and Wikiprogress platforms in the area of gender equality and societal progress to engage in, and facilitate, policy dialogue with governments, civil society and citizens in all the countries in the world.

In OECD countries, national statistics offices are beginning to use big data to improve the timeliness and cost- effectiveness of their statistical production, too.

But big data does not automatically mean bigger and better information, and an Did you know that, according to increasingly used to forecast world output. increasingly important function of national the UN Global Pulse, more data was At the same time, social networks such statistics offices in the future will be to created in 2011 than in the whole as Facebook and Twitter have already help users separate high quality statistical of human history, or at least, since revolutionised the way policymakers information from low quality data coming the invention of the alphabet? from all kinds of new sources. Big data does not automatically mean Technological and social innovations There are other challenges too. One is are resulting in huge flows of new data bigger and better information Internet privacy, which is at risk of being every day. This proliferation of so-called undermined by relentless hunting for “big data” has the potential to change the interact with civil society. Governments greater and more detailed information. way information is collected and used to use these networks both to push their And another is finding innovative ways inform policymaking. messages out and to pull information to communicate and present the stories in that may influence the design and that the flood of new data generates. These New sources of data are increasingly targeting of policies as people place more are all challenges the OECD is addressing, providing real-time information to analysts of their personal information on social so that, like the alphabet, the age of big and policy-makers. For example, it is networking sites. data brings clear benefits to policymakers now possible to collect price data on a and citizens alike. wide range of goods and services with International organisations are getting smartphones, and then calculate a daily involved too, the creation of UN Global Visit www.oecd.org/statistics price index. Similarly, job offers posted Pulse being a case in point. The OECD www.oecdbetterlifeindex.org online provide a new source for analysing has also been harnessing the potential O’Reilly, Marie, (2012), “Interview with Robert Kirkpatrick, labour market trends, while data on of big data. Collecting statistics and Director of UN Global Pulse, on the Value of Big Data”, 5 November, available at www.theglobalobservatory.org Internet financial transactions and sales are understanding trends are the daily bread

OECD Observer No 293 Q4 2012 17 FOCUS FOCUS S pecial S pecial Information society: Which way now?

Andy Wyckoff, Director, OECD Science, of the last five years. The increased use of travel. A policy priority in most economies Technology and Industry Directorate the Internet has forced business models to is to jockey for position in higher value- change, causing significant restructuring added activities and market segments. The future will be inherently in a number of sectors, including news and Knowledge-based capital, such as knowledge-based. Are we moving publishing, advertising, travel, banking software, R&D, branding and intellectual in the right direction? What must and the retail sector. property are keys to competitiveness we know to be able to get there? and employment. In many countries, Understanding knowledge-based The combination of smartphones and investment in such capital may well exceed capital is an important first step. wireless broadband connections with traditional investments in machinery, “cloud” computing promises to unleash equipment and structures, although As the economy emerges from the even more structural changes. The corporate reporting and national accounts financial crisis and the lingering period advent of the ability to draw on vast do not yet fully consider these assets. of slow growth, four trends in science, amounts of data to optimise logistics, technology and innovation are emerging. customer relations and make real-time Like any deep structural shift, building First, a slowdown in innovation due to decisions could have a significant impact, a knowledge-based strategy and finding a heightened risk aversion and a paucity of particularly on jobs of a “transactional” foothold in global value chains will require risk capital; second, widespread structural nature. effort, and it may initially exacerbate change as the information revolution goes employment and inequality problems. mobile and e-commerce reaches a level ICTs have helped drive the rise of global But the prize will be the opening up where it is the dominant force in retailing, value chains, which surpass old notions of huge opportunities that not only boost enabled in part by the power to mine vast of national borders, and will change productivity, but also address many social quantities of data; third, developments in and environmental challenges of our information technology and other forces Global value chains surpass old time, from ageing to climate change to are leading to greater specialisation and notions of national borders development. the growth of complex global value chains; and fourth, the growing recognition that Visit www.oecd.org/sti the key to sustained competitive advantage what economies produce and how they lies in the exploitation of knowledge-based are steered and managed. With global capital, such as research and development value chains, stages and interconnections (R&D), skills, brands and organisational matter more than places or sectors. structure. It’s about largely tacit knowledge Competitiveness can no longer be Reading for that is hard to replicate and tends to be solely assessed in terms of gross export “sticky”, or rooted in a particular locale. performance: imports count too. The knowledge GVC concept will affect a wide range of These four trends are interconnected other policy domains, including industrial and self re-enforcing. Combined, they policy, skills, access to markets, the role will require us to redefine and update of capital and the use and protection of our thinking about the economy and intellectual property. about appropriate policies in a wide range of areas that themselves are changing, In a world where stages and tasks such as global taxation, competition, matter more than the final products finance, skills, trade, technology, and types being produced, global value chains also of structural policies. They also offer new challenge our orthodox notions of where opportunities, provided that these tech economies find themselves on the value- trends can be harnessed. added curve. Whether in smartphones or airplanes, most of the value of goods is While scientific and R&D activity has typically created upstream where product been reduced by the crush of the crisis, design, R&D or production of core there are exceptions in specific sectors components occur, or in the tail-end of like information and communication downstream activities where marketing, Order now at technology (ICT), and in Asia, where branding and distribution occurs. The www.oecd.org/bookshop innovative activity remains strong. In fact, same applies to services, such as insurance they were barely affected by the downturn claims, clinical trials for drugs and air

18 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial Getting to know each other: The OECD and Latin America

José Antonio Ardavín, Head, OECD Mexico Centre paradox in all this. IT has transformed OECD relations with non-OECD countries as well as with members such as Chile and Mexico. But this has also brought these countries under more scrutiny. And the more governments seek an active engagement with the OECD, the more citizens and the media become involved, and informed. They see how their country is performing, over time and can compare it with others. They learn about the challenges. And they use OECD information to hold their governments to account for their actions (and inaction) regarding key public policies.

This activity might make government

©Reuters/Stringer Mexico ©Reuters/Stringer officials feel uncomfortable at first, Three cheers for better policies particularly if confronted with unfavorable international comparisons. After all, it Nearly two decades ago, in May 1994, and Portuguese translations of OECD is not easy to be up against the world’s Mexico became the first Latin American publications every year, which audiences best performers in so many policy fields, country to join the OECD. Not long after, can access via iLibrary. Online traffic to particularly for developing countries. But in 1996, the secretary general of the OECD OECD iLibrary from Latin America grew then again, that is what reality checks are at the time, Jean-Claude Paye and the then 38% in 2012 compared with 2011. for: not to limit, but rather to encourage Mexican minister of foreign affairs and a better performance. Just look at Mexico, current secretary-general, Angel Gurría, In addition, the OECD Mexico website has which after 18 years of being subject to opened the OECD Mexico Centre. Initially, become the OECD gateway for Spanish such scrutiny and public debate, seems our job was to promote OECD publications speakers. The traffic to the website has finally to have entered a virtuous cycle of in Mexico and throughout Latin America. doubled over the past three years, to over progress. It is proof that better policies do But that mission has grown since, to half a million people. indeed lead to better lives. include “disseminating, promoting and making accessible better policies, to Social media has been a major asset Our growing and promising co-operation governments, economic and social actors in helping our dialogue with Latin in Latin America is just beginning. throughout Latin America, for better lives American citizens. The Twitter account As well as our many publications–the of their citizens”. Latin American Economic Outlook is With visibility and interaction already a milestone after six editions for The OECD and Latin America have got comes responsibility instance–the newly launched OECD Latin to know each other far better during this American and Caribbean Initiative is period, thanks largely to the Internet @ocdeenespanol now has nearly 20,000 already producing valuable results, thanks which was also born around the same time. followers, and we see that number to constant dialogue and intelligence- Take information itself. Previously, the continuing to grow. Such innovations have sharing in the fields of taxation, innovation, dissemination of OECD work was mainly not only helped us to communicate directly investment and public services. carried out through printed books, which with ordinary people, but also to position limited our distribution in Latin America. the OECD at the heart of important Latin America has transformed since 1994, However, online subscriptions, notably debates. During recent heated discussions and the information revolution continues via OECD iLibrary, have helped us build and demonstrations on Chilean education to play its part in nurturing this new growing audiences in Brazil, Colombia, reform, for instance, the “OCDE” became knowledge society. If this momentum is Chile, Argentina, El Salvador, Venezuela, a hub of knowledge and data, allowing us built upon, then the next 10 years could Peru, and more. to trend on Twitter. truly become “the decade of Latin America”.

Meanwhile, the Mexico Centre and other But with visibility and interaction comes Visit the Mexico Centre website at partners produce more and more Spanish responsibility. There is an interesting www.oecd.org/centrodemexico

OECD Observer No 293 Q4 2012 19 FOCUS FOCUS S pecial S pecial Combating terrorist financing in the information age

Rick McDonell, Executive Secretary finance terrorism. The FATF standards Financial Action Task Force require countries to assess the risks posed by new products and delivery methods, and The explosion of the information world we have conducted studies into emerging Standards has been a benefit for our organisation, money laundering and terrorism financing but has raised its own set of new techniques to ensure that its standards against abuse problems. remain up-to-date. Download today The Financial Action Task Force (FATF) There has been a significant rise in recent is an inter-governmental policymaking years in the number of transactions and www.fatf-gafi.org body, with a ministerial mandate to the volume of funds moving through new establish international standards for and innovative payment methods such combating money laundering and the as prepaid cards, mobile payments and financing of terrorism and proliferation. Internet-based payment services. The rapid development and dynamic nature It relies on building networks, accessing information and issuing reports. We use Deciding on the balance between tools such as a blacklist which helps to put peer pressure on countries to step transparency and discretion, up their fight against terrorist financing communication and confidentiality, and money laundering. is a matter of judgement

With the Internet, more people can access our work, and more people can of these new payment methods has created consult with us too. Also, the impact of challenges for countries and private our announcements and awareness of sector institutions to ensure that these the FATF and what it means has probably products and services are not misused been heightened by the likes of social by criminals. The risks of money media, particularly retweets. But while laundering and terrorist financing vary we welcome increased transparency and depending on the functionality of the openness, for the FATF to be effective, service and the presence of measures it remains necessary for us to maintain to prevent criminal misuse. confidentiality and discretion. This need has been a hallmark of work at The Internet and related technologies the OECD too. Deciding on the balance such as Twitter and Facebook have between transparency and discretion, contributed to strengthening the role communication and confidentiality, and the image of the FATF’s Global is a matter of judgement. Network. Over 190 countries have committed to implementing the FATF We do not operate by blazing lights, but Recommendations and protecting the by soft pressure and building confidence international financial system from and trust. Real actions sometimes depend misuse by criminals and terrorists. These on discretion and patience, and the fast countries are part of the FATF’s Global speed of real time communications can Network through their membership add unwanted pressures. of the FATF and/or one of the FATF- style regional bodies. This structure is There is also another challenge: improved represented in our new website which IT has made it easier for people to finance has been designed as a gateway to these terrorism and created opportunities to bodies too. So when you see our website, cover up money laundering activities. The you see the FATF Global Network. FATF has recognised the need to address the risks posed by new technologies being Visit www.fatf-gafi.org used by criminals to launder money and

20 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial Africa.radio

Roman Rollnick, Chief Editor, Advocacy, Outreach and Communications, UN-Habitat Kenya is similar. The mobile phones have enabled Africa to leapfrog computers too, despite the digital and educational divide. Africa now stands poised to take advantage of new tablet devices. Most people use the French developed M-Pesa mobile phone payment system to send small sums to loved ones or pay their bills.

So, as the OECD Observer predicted in 2001, Africa was able to leapfrog straight from little or no phone service to mobile phones and the Internet, but the gap between the industrial and the developing world remains enormous. People have the phones, but most have little credit. There is also a literacy issue as well. Radio and TV still definitely rule, not the Internet.

Is this an indicator of the digital divide that the vast majority of people in Africa today still rely on the radio for news and information? In Kenya, for example, like in Côte d’Ivoire across the continent, Though mobile technology is making the other side of town, sealed off from the BBC World Service and Radio France waves in Africa, airwaves still count. the sea of humanity, eking out a living International are available to listeners in the slums. In Nairobi, there are nearly on the FM radio. Local television channels At the start of the new millennium, a million people living in a slum called in Africa offer an even wider range mobile telephones were a novelty in Africa. of international broadcasters. An OECD Observer article claimed then People have the phones, but most that leapfrogging had started as mobile have little credit Still, the potential for growth of the mobile telephony took hold. In most countries telephone and tablet market in Africa it took weeks or months for people to Kibera, which is roughly the size of a golf is arguably the greatest anywhere in get a landline. And in many countries, course. In fact, it is right next door to the the world. Three major undersea cables the communications infrastructure was exclusive Royal Golf Course. In Cape Town, serving east Africa mean that the Internet insufficient, and poorly maintained. the slums are growing daily. Like Nairobi, is faster in Nairobi than in the continent’s Cape Town has one of the highest Gini wealthiest economy, South Africa. In the cities of sub-Saharan Africa, coefficients in the world–an internationally from Cape Town to Nairobi, Addis Ababa, accepted yardstick of the gap between rich And how appropriate that leapfrogging Luanda, Kinshasa, Lagos, you name it, and poor. has been. Just 60 kilometres west of 50 to 80% of people live in slums, most of Nairobi, in the Great Rift Valley, some whom are denied access to health services, As mobile phones became cheaper and of the world’s earliest hand-held devices education, clean water and sanitation. smarter, more Africans bought them. are to be found if you care to look carefully: Computers? Forget that, they come later Mobile telephones allowed Africa to those beautifully shaped stone hand-tools after decent shelter, human and civil rights. bypass the traditional terrestrial systems made by our Homo erectus ancestors prevalent elsewhere in the world. And their dating back some 900,000 years. More often than not in urban Africa, impact is greater in Africa than anywhere. the city economy thrives on the informal Example: in anarchic, conflict-torn Somalia, Visit www.unhabitat.org sector, and the wonderful small initiatives mobile telephone services are more easily Jütting, J., J. de Laiglesia (2009), Is Informal Normal? Towards More and Better Jobs in Developing people take to improve their lives in their accessible, available and cheaper than in Countries, Development Centre Studies, OECD own way. Big government and big business most other places in the world; Uganda is Publishing. are another world away, which in Africa believed to have three times as many SIM James, Edwyn (2001), “Learning to bridge the belongs to the wealthy elite. They live on cards as people living within its borders. digital divide” in OECD Observer No 224, January.

OECD Observer No 293 Q4 2012 21 FOCUS FOCUS S pecial S pecial Is evidence evident?

Anne Glover, Chief Scientific Adviser to the President of the European Commission

Science and technology play a central States vote 100% in favour of the scientific communicated is research not done. role in our society. They are part of opinion, while others vote 100% against If scientists don’t communicate effectively everybody’s life, they help to tackle the the scientific opinion–based on the same about their findings, other more doubtful grand challenges of humankind and evidence. lobbies will fill the gap and the societal they create innovation and jobs and debate will get off on the wrong foot. Once This voting behaviour suggests that this happens, it is very hard for even the improve quality of life. Science and public opinion and perceptions, and best scientists to make themselves heard. technology are part of our culture, and not the evidence of science, steer debate in essence define us as a species that more in some countries than in others. In the case of biotechnology this means “wants to know”–hence why we are This does not serve all citizens well as that generating first class knowledge called Homo sapiens. But do we really everyone deserves to benefit from is not enough. Scientists must better give science its proper value when it leading-edge scientific knowledge being communicate what biotechnology can offer comes to taking political decisions? generated in Europe. to enhance people’s lives or to tackle wider challenges in the fields of health and food Biotechnology and genetics in particular, Are there lessons to be learned for the security, for instance. This does not mean are striking examples. Take genetically introduction of future technologies? that risk assessments should not be done modified organisms (GMOs). The scientific How can we achieve a more rational and or ignored, on the contrary. But risks need consensus is that GM food is not riskier robust societal debate that balances both to be put into perspective and balanced than conventionally farmed food. If you the risks and the rewards? against the likely rewards. look at the scientific opinions the European Food Safety Authority (EFSA) First of all, scientists must communicate The language used by scientists is also has delivered in this field, you might be more proactively about their research important: it must be easy to understand, puzzled to see that some EU Member and their methods. Research not while not neglecting the communication

22 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial

of uncertainty. In so doing, scientists must policymaking machine works and at scientists are not. Science is just part show genuine empathy for public concerns which points in time scientific input of the decision-making exercise and and avoid being perceived as arrogant is most urgently needed. By the same it may well be that depending on the about “owning” the truth. Scientists need token, politicians need to understand that circumstances–and for good reasons– to be honest about what they know and economic, social, ethical or electoral what they don’t know–the public deserve Research not communicated is concerns prevail. But if politicians choose our respect. research not done to ignore the evidence, they should say so and say why. This will enable citizens When communicating with policymakers, science is not delivered at a stroke and that to make up their own minds and to it is essential to not leave them with one building up evidence takes time, not least challenge their representatives. As Nobel single choice. Scientists must offer a range for accuracy checks. prize-winning US Energy Secretary Steven of options from which policymakers may Chu put it: “You are entitled to your own choose. They all may to lead to the same While scientists should set their results opinions, not your own facts”. goal and offer benefits, but the way of in a broad, societal context, we must also getting there might be different. challenge politicians not to cherry-pick the Nor is evidence a matter of opinion. Maybe science that suits their view of the world, we all need to be a bit bolder on that point Timing is also crucial: there is no or short-term political goals. The body in our communications: scientists with point in delivering a superb report one of evidence needs to be seen as a whole. politicians, and politicians with the public. week after the political decision has been And if politicians reject the evidence, taken. Therefore, the policymaking and we should expect from them honesty and For more on Professor Anne Glover, see knowledge production cycles must be transparency about their motivation. ec.europa.eu/commission_2010-2014/president/chief- scientific-adviser synchronised in a smart manner. Of course, politicians are free to ignore Visit the European Food Safety Authority at Scientists need to understand how the the evidence–they are elected–while www.efsa.europa.eu

Global economic power and influence is rapidly shifting east. But the onset of the Asian Century is accompanied by what some observers are calling the Asian Paradox: the fact that the world’s fastest growing region is home to almost half the world’s extreme poor, and faces major challenges in areas such as health, governance and food security. At the University of Sydney, our experts are working to find solutions to these real world problems – experts like Robert Park, who is developing new strains of wheat that are resistant to the rust diseases that devastate crops and threaten the food supplies of millions. FOOD FOR It’s just one example of the impact our research is having on the world. THOUGHT Active minds. We change worlds.

For more information, head to sydney.edu.au

OECD Observer No 293 Q4 2012 23CRICOS 00026A FOCUS FOCUS S pecial S pecial News that’s fit to post

Monique Villa, CEO of the Thomson Reuters Foundation Foundation, as part of our mission to improve the standards of journalism around the world, had delivered extensive training for journalists in Egypt. As the situation escalated, a group of journalists from Cairo who had benefited from our training requested the support of the foundation to fill Egypt’s growing news vacuum. A team from London rushed back to Egypt, found funding and created Aswat Masriya, meaning “Voice of the People”, a website that brings quality, objective journalism in Arabic.

It was an instant success, and has received two million unique visitors in the last year alone. Aswat Masriya became the reference for those looking for facts, not propaganda.

The website has been such a success–and such an important source of information for ordinary Egyptians–that what was initially a one year project from the

New media has arguably brought people closer to policymakers

Thomson Reuters Foundation has quickly become part of the drive for democracy in Egypt. The demand for quality media is so real that we have decided to extend the project with renewed funding that will keep the site alive for at least two more years.

The people of Egypt had been starved of the truth for too long and were determined to make a change. The world watched as ordinary people helped our understanding

©REUTERS/Amr Dalsh ©REUTERS/Amr of unfolding events via social media, uploaded images and SMS texts. Their The media is changing, but must and its apparatuses, but the media voices were heard all over the world. assume a leading role in the unfolding organisations that had censored and self- narrative of the information world. censored to further Mubarak’s rule for 30 Aswat Masriya is a great example of That includes building trust and years. But with so much happening so fast, information as aid. Its mission is to involving new voices in the discussion. the people still needed sources of news empower ordinary people and to give them that was accurate, independent and, above the facts they need for their political action. When the winds of the Arab Spring blew all, a trustworthy account of what was across North Africa into Cairo’s Tahrir going on around them. Traditionally, the news media has acted as Square, the people of Egypt gathered a buffer between governments and their to tear down every symbol of the hated The year before revolution swept through people, holding governments to account dictatorship: not just the government the Arab world, the Thomson Reuters and keeping citizens informed about both

24 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial

progress and transgressions. Democracy uploading videos or using Twitter to itself demands that governments are comment on the world around them, Your key to the OECD monitored by media institutions. But new media has arguably brought aid creating an environment conducive beneficiaries closer to policymakers. to independent media is no easy task, It is also challenging the traditional An award-winning* magazine and online requiring complex legislation, a highly media’s tendency to put western service to keep you ahead of today’s professionalised journalist class and a commentators at the forefront of trusted economic and social policy challenges. sufficiently mature advertising sector. analysis, while keeping voices from the The OECD Observer magazine presents ground on the sidelines, using them authoritative and concise analysis of crucial For those of us in the international sector, only for tone or as case studies. world economic and social issues. It helps all of this is only important in so far as business, NGOs, academics and journalists it alleviates the suffering of the world’s Established news organisations like to stay ahead of the policy debate. poorest people and helps us to formulate Thomson Reuters have an important policies to achieve that. We know how role to play in this process. “Citizen • Expert views on global issues journalism” is growing in importance • Special in-depth reports The shifts have profound and influence, but traditional media is • Key economic, social, environmental still often the best placed to provide implications for the way people and scientific data footage, images and insight. • Links, references and bibliographies consume information and hint for further research and background at an unprecedented new role These shifts have profound implications • Listings of meetings, books, reports, for the way people consume information– for specialist media working papers, etc. bypassing traditional media–and hint at an unprecedented new role for specialist Plus the agenda-setting OECD Yearbook, useful new media can be to an Egyptian media, a lot of which may not subscribe free with every order. protestor with a smartphone. But what to the core journalistic values we take Subscribe to the OECD Observer about the starving child in Mali? Or the for granted. print edition today at Burmese woman trafficked across borders www.oecdbookshop.org to marry a man in China against her will? Paradoxically, perhaps, it also hints at an or benefit from a special two-year even greater need for traditional media subscription rate only available at As we approach 2015, the international to act as a kind of trusted filter. This is www.oecdobserver.org/subscribe.html dialogue around the Millennium what the Thomson Reuters Foundation is Development Goals is changing. We attempting to achieve with our training *2002 Highly-Commended award are looking at what has worked and, programme of journalists in Egypt after from the Association of Learned and perhaps most importantly for reasons the revolution, and elsewhere around the Professional Society Publishers, UK of accountability and progress, what hasn’t. world. But who will we include in that discussion? For editorial queries, Is a New York committee room the best Media has certainly changed forever. contact [email protected] place to decide what is best for the world’s The gates of the fourth estate have been poorest people? How will we be able to thrown wide open. Anyone may enter this

Free zones: Benefits and costs utilise social and emerging media to bring hallowed ground, but in order to ensure Investing in transport Renewable promise Women at work No 275 November 2009 www.oecdobserver.org Ministers’ roundtable ES Modernising the public sector the voices of those most in need into the that the debate remains bothTT civilER LIV and OECD Yearbook 2012E S F OR B R P OLI CIE OECD Yearbook BETTE , renowned guests from government, business, trade unions OECD Yearbook In this, the second annual and civil society join OECD experts to explore the key questions which confront the world economy in 2012. discussion–not just to measure progress, useful we must agree Whaton has the crisis whotaught us about the need canfor a new approach tobe economic policymaking? heard What risks MENA-OECD do we face and how do we deal with them? Will unemployed youths ever reach their full working potential? How do we give greater economic empowerment to women? Is the middle class on the way out in advanced economies and on the way up in the emerging world? Can better governance prevent future crises? Do green and growth go together? How do we really measure the progress of our societies? A brighter outlook LIVES but also to inform each other about what and when. looks at these and other questions. It also presents country snapshots for The OECD Yearbook 2 1 02 40 economies with data and commentary from selected OECD publications. BETTER POLICIES FOR BETTER

is happening, why and when? Emerging Euro spotlight Occupy: Main lessons OECD Yearbook 2012 Huffington on the squeezed middle No 290-291 Q1-Q2 2012 References better www.oecdobserver.org Generations together?

media provides us with two-way channels Ministerialpolicies Councilinequality and Forum Special 2012 Gender: Pushing for a change crisis lives trust OECD Skills Strategy

gender energy FRQILGHQFH servicesideas Tax and inequality Visit www.trust.org, the portal of the Thomson BETTER POLICIES FOR BETTER LIVES change ODERXU Long-term investment of information that should be seen as innovationnuclear well-being trade Reuters Foundation, the philanthropic wing of the JURZWK developmentyouth technology tools of accountability. food security middle class j orenewables b s

multimedia news agency. governance skills progress wages r i s k Visit en.aswatmasriya.com sustainable For a new media revolution to be fully OECD Yearbook 2012 ISBN 978-92-64-02226-3 01 2011 06 1 P -:HSTCQE=UWWW[X: ISSN 0 0 2 9 - 7 0 5 4 harnessed in the interests of true global OECD Observer No. 288/289 January 2012 development, we must ensure that all the voices of the South are brought into policy debates. With more citizens

OECD Observer No 293 Q4 2012 25 FOCUS FOCUS S pecial S pecial Asia’s information revolution

John West, Executive Director, Asian Century Institute*

The rise of IT and the Internet have been both an important producer and in Asia, which in turn has underpinned been boons to Asia, but not everyone user of IT products. Indeed, Asia has rising levels of prosperity and education has benefited. There are challenges always been fertile ground for information- across the region. to overcome, not least in the area of based activities. China was at the heart governance. of arguably the first information revolution Asian economies like Japan, Korea, when it invented paper making and the Malaysia, the Philippines, Singapore, The global information revolution is having printing press in the 9th century, and Chinese Taipei and Thailand are now profound effects on economies, societies all important producers of hardware, and politics in Asia. This should not be China was at the heart of arguably while Korea’s Samsung is now a global a surprise. After all, improved access to the first information revolution when leader in many product areas, including information is of fundamental importance smartphones. to development, as it can facilitate the it invented the printing press in the necessary improvement in an economy’s 9th century Korea is the world’s most advanced player knowledge base, as well as more in ICT, according to the International transparent and accountable governance. propagated to its neighbours a Confucian Telecommunication Union (ITU), a UN And information and communications culture which values education. The body, which says that it is overtaking many technologies (ICT) enhance integration contemporary information revolution other economies like the US, Japan and into the global economy. arrived at the same time as China’s Germany which have much higher GDPs economy was opening up again, and per capita than Korea. But why have so many once-poor Asian as Asian countries were experiencing countries been able to take advantage of the most dramatic period of economic A number of other Asian economies were ICT, more than other developing countries? development that humankind has known. ranked by the ITU to be in the world’s The main answers are history, timing and top 20 for the “ICT Development Index”, China. The impact of the information Rapid progress in IT and investments notably Japan (8th), Hong Kong-China (11th) revolution has been greater in Asia than in the necessary infrastructure have been and Singapore (12th). Other Asian countries elsewhere because the region has always key drivers of the information revolution stretch way back in the overall list of 155

26 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial

countries, with Malaysia ranking 58th, countries, and civil society has asserted China 78th, the Philippines 94th, itself, several countries such as Bangladesh, Indonesia 95th and India 119th. India, Indonesia, Mongolia, Chinese Taipei Korean and Thailand now have laws enabling the Rising levels of education are in part public to request and receive government- knowledge due to better access to ICT, while at the held information. same time the ability to absorb and use Korea is one of the world’s fastest information are being enhanced. Many For China and other countries with growing economies and a global Asian economies are also global leaders one-party dominant states, the Internet, player in trade and investment. And in education. The OECD Programme overseas travel and more open economies Tae-Shin Kwon, former ambassador to for International Student Assessment and societies have also improved public the OECD and now vice-chairman of (PISA) ranks Shanghai-China, Korea, access to information. Surveys such as the Presidential Council on National Hong Kong-China, Singapore and Japan those by Freedom House may well judge Competitiveness in Korea, is in no in its top 10. China is also becoming an the Internet and the press in China not doubt as to the main causes of his important research centre (see Databank). to be free. Yet China is estimated to have country’s success. However, both Thailand and Indonesia are around 500 million Internet users–that’s “Korea’s economy is based on exports, much lower down the list, reflecting Asia’s more than the US and Europe combined. thus our relationship with other “education divide”. Its social media is very active with China’s countries is one of the most important own version of Twitter, “Weibo”. factors for the economy. Information The ICT revolution has facilitated the and communications technology has development of East Asia’s manufacturing The Communist Party of China follows connected Korea with other countries production networks, or value-chains, public opinion very closely, notably about faster, and at a lower cost,” he told that have enabled many economies to corruption, as witnessed by the recent the OECD Observer. jump on a fast track to development. demise of once-political frontrunner, Bo A classic example of these production Xilai. The outgoing president, Hu Jintao, But for Mr Kwon, knowledge is networks is Apple’s iPhone. Its branding, remarked that combating corruption and essential, so what really made the design and marketing are undertaken in promoting political integrity are of great difference was the people. “There the US. Most of its high-tech components concern to the people and, if not handled would be little point investing in ICT are produced in Germany, Japan, Korea well, they could even cause the collapse of if people were unable to use it, or if and Chinese Taipei. And finally, the lower the party and the fall of the state. China the legal system impeded people’s value-added assembly stage is conducted is well aware that social media has played access to information sources.” in China. a role in mobilising political movements like the Arab Spring and the second People Various promotional policies helped Meanwhile, many advanced countries Power Movement in the Philippines. ICT to expand, and the government put have off-shored many back office functions, in place a legal and regulatory system as well as creative processes, such as Asia has been the success story of the to promote a transparent society. 3D animation, video game development, past 50 years, as a wave of knowledge, All of this has helped improve the and sound engineering, to less advanced innovation and progress as swept through country’s governance. “As people use economies, such as India and the the continent, starting with Japan in the ICT infrastructure more, they can Philippines, with their strong English 1960s and 1970s, and continuing with more easily make their wishes known language and IT capabilities. China beating a new path forward. The to the government,” Mr Kwon notes. challenges of education and digital divides A key factor in the Asian story is youth. remain, and reforms are needed in several ICT has brought spin-offs for education Asia’s “tech-savvy” young generation countries to boost telecommunications and too, with Korea being consistently is vastly more informed, connected and electricity services. Nevertheless, future among the best performers in the empowered than their parents (and headlines will surely record that this was OECD PISA school surveys. “Internet leaders), thanks to the combination Asia’s century. literacy and our advanced ICT of technology and improved education. *John West spent 22 years at the OECD during which infrastructure quite simply opened time he worked in the secretary-general’s office, and the door to the information society”, The information revolution has helped was head of Public Affairs. He helped launch the OECD Mr Kwon remarks. change the relationships between Forum in 2000. John has worked in Japan and has citizens and government authorities too. travelled extensively in China and elsewhere in Asia. Visit competitiveness.go.kr As democracy has taken hold in some Visit www.asiancenturyinstitute.com

OECD Observer No 293 Q4 2012 27 FOCUS FOCUS S pecial S pecial The changing art of language

René Prioux, former Head of Translation, OECD* tracking down information in libraries simply because there was no alternative. Machine translation (MT), first researched in the US in the late 1940s at the beginning of the Cold War, was making its first hesitant steps. Translators at that time would type their texts in duplicate using a typewriter and carbon paper. At the current rate of progress, touch-screen tablets are as likely to be seen as outdated in a decade as typewriters are today.

In the space of several decades, the world of translation has changed radically. Dictionaries have been elbowed aside by databases. Analogue Dictaphone cassettes have been dislodged by digital voice recognition software. Fifty years on, MT is still struggling with problems it seems far from capable of resolving and has been overtaken by computer-assisted translation

Only human minds can unravel the threads of a rambling speech or complicated logic

(CAT), which can quickly find sentences and parts of sentences that have already been translated in countless original texts and human translations stored in servers. Faster flow management tools now help to manage the processing of translation Translators are at the forefront communication technologies were in requests, and new technologies have made of global communications and their infancy. The term “computer” had outsourcing much easier. The Internet knowledge. Yet their work has not been coined just a few years earlier and has worked wonders in revolutionising always been helped by the information neither the Internet nor microprocessors the search for information and is greatly revolution. Here are the challenges. had been invented. And televisions were prized by translators who use it to find just beginning to appear in people’s answers to many of their questions. If you are reading this article in English, living rooms. you should bear in mind that it was This looks like a hugely positive balance originally drafted in French. But such is In the world of translation, most sheet. But on closer inspection, the picture the art of the translator, to do their job information was sourced from technical is more mixed. Yes, documentary and in such a masterly yet invisible way, that manuals, dictionaries, specialised terminological research techniques have you would probably never have noticed publications and experts. Terminological improved spectacularly, and networks had I not pointed it out. Yet translation is research was extremely time-consuming link one end of the planet to another– a highly-skilled and difficult job. Has the since information had to be sought something even the most visionary work of the translator been improved by out mainly in public and private thinkers could never have imagined half a innovations in technology in recent years? documentation centres or in works sold century ago. Yes, the Internet means that by specialised bookshops. Time was just details about a person, event or subject When the OECD was established just as precious as it is today but it was quite are just a few clicks away. And yes, we can over 50 years ago, information and common for translators to spend hours track an order in real time and put out

28 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial

countless tables of statistics. Indeed, given when increasingly tight deadlines mean this embarrassment of technological riches, that proper research cannot be done or the we should be entitled to expect substantial work of translators revised correctly. Found in gains in both quality and quantity. Yet this The growing specialisation and complexity has not happened. Indeed, progress has of human activities and the broadening been derisory when compared to what scope of sectors in demand are additional translation has been achieved in terms of creating, challenges facing translators who need English and French are the official consulting and managing information. to develop expert knowledge of a wide languages of the OECD, but as Translation quality has not, alas, improved, range of subjects within their main the organisation’s global audience and productivity has not stepped up to the areas of expertise. has risen, so has the demand for levels promised by the most enthusiastic formal translations. The translation supporters of new technologies. At first Moreover, it is widely accepted that it department now deals with about sight, this gap between performance and is possible to have too much of a good 20 other languages, including technical progress is a mysterious one. thing. There is a profusion of information Arabic, Chinese, Russian and now available, particularly online, but Spanish. Extra demand comes in But in reality, there is nothing mysterious different websites give such contradictory (sometimes unpredictable) phases: about it. Translation remains first and accounts that translators often find it hard for instance, there has been a great foremost an intellectual exercise which to separate the wheat from the chaff and deal of Japanese to English work consists of analysing and understanding have no option other than to continue recently, reflecting new legislation information before faithfully reproducing their research in order to get at the truth. and interest in the wake of the it in another language. The array of technological means at their Fukushima accident of 2011. disposal can thus become a handicap. While modern tools can be used to quickly The situation reminds me somewhat of a Italian has also been in demand, find terminological equivalents or explain bygone era when French students would reflecting the debt crisis in that unfamiliar concepts, it is the human mind pore over the famous Gaffiot Latin-French country. Portuguese is another that continues to do the work, to analyse, dictionary in the hope of finding complete language now in demand, not just understand and reproduce the right text. French quotations from Virgil or Julius by Portugal, but also as a result of For a start, most translation technologies Caesar’s Gallic Wars for their Latin essays. increased relations with Brazil and are a guide at best, and can misguide the Mozambique. untrained eye. One only has to try Google’s In short, translators have become totally translation tool to understand this. dependent on IT. Without Internet access, The numbers for formal translation they are as lost as engineers without tell an impressive story. There are More fundamentally, only human minds their calculators. No wonder network a few thousand requests each year. can unravel the threads of a rambling malfunctions are such a huge worry for A standard OECD page is 300 words, speech or complicated logic. Indeed, translation services! and in 2011 alone some 70,000 source texts are increasingly peppered pages were translated. with errors due to the pressure of short Despite these downsides, IT has made deadlines, leading to poorly edited works life much easier for translators on several That’s a lot of translating. As Mark that include multiple amendments by fronts. Yesterday’s translators would be Evans, a senior OECD translator, both internal and external hands along the completely out of their depth in today’s points out, this is the equivalent production chain. Against this background, world. Contemporary translators have of producing an old Encyclopedia the translator is increasingly becoming an not only adopted new technologies, but Britannica (about 150,000 standard “investigator” who examines texts, or an continue to keep track of developments OECD pages) every two years. “enlightened decoder” who clarifies, where in everything from MT to new means of necessary, the logic of the source text and communication such as social media and Meanwhile, the OECD Publishing the thinking of its authors by untangling crowd-sourcing. In fact, translators remain division grants third rights for the various traps encountered from very much in the vanguard of our time, translations to meet local demand in sentence to sentence. ready to build knowledge and help foster many other languages too. progress through better communications The decline in the quality of source texts for our global, multilingual, village. See www.oecd-ilibrary.org/about/copyright has acted as a brake and counterpoint to the benefits of modern technology. The *René Prioux spent 26 years at the OECD and was head quality of translations suffers as a result of translation from 1996 until his retirement in 2011.

OECD Observer No 293 Q4 2012 29 FOCUS FOCUS S pecial S pecial Ad sense

An interview with Richard Huntington, Strategy Director, Saatchi & Saatchi ©Saatchi & Saatchi

Politicians have long called on the a political party had used advertising to first in British electoral politics, but not in services of public relations firms, help win an election. The poster caused a public policy. “The UK has a rich heritage stir. Denis Healey, a senior figure in the of investing significantly in government design experts and advertising Labour government of the 1970s, derided communications”, Mr Huntington points agencies to help them communicate. the Conservatives for selling “politics like out, adding that “in an apolitical sense, What impact do they have, and how this heritage has pretty much existed since has their role changed? We asked one Political advertising is commonplace the Second World War: the Ministry of of the very biggest in the business, Information and Propaganda during the nowadays in most OECD countries Saatchi & Saatchi, for some insights. war years for instance. But there was a ramping-up in the 1980s. By the time we In 1979, a large, rather stark, poster soap powder”. But the poster helped sway reached the millennium the government appeared on billboards across the UK. the British electorate in favour of Margaret was one the biggest ad buyers in the UK”. The poster displayed a long queue of Thatcher. It made Saatchi & Saatchi world people shuffling under an awning that famous, brought fame and fortune to Political advertising is commonplace read “unemployment office”. At the its family founders, Maurice and Charles nowadays in most OECD countries. Laws top of the poster, in heavy black letters and opened a new front for campaign about advertising can be quite strict, such punctuated by a peremptory full stop, were war chiefs. If Saatchi’s remains in the as in France, where each candidate is the words “Labour isn’t working.” On vanguard of communications globally, then allotted 18 television spots–ten lasting the bottom margin, in a discreet, almost those early days were crucial to its success. 90 seconds and eight lasting three confessionary aside (the letters were the minutes, 30 seconds–during which time smallest on the poster) was the response: “In fact, we learned a lot from selling they cannot denigrate other candidates “Britain’s better off with the Conservatives”. soap powder”, says Richard Huntington, or seek donations. The opposite is true Strategy Director at Saatchi & Saatchi. in the United States, where advertising The poster was designed by a fresh and is often pugnacious and (as was clear in brilliant start-up named Saatchi & Saatchi. Bringing such an agency on board for the the television spots for the recent US It was the first time in British history that 1979 election campaign may have been a presidential election) seems mostly intent

30 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial

on mocking the credibility of the opposing Charles to quit the firm, he dropped the candidate rather than delivering a cogent word “advertising” from the name and political message. rebranded Saatchi & Saatchi as an “ideas Happy birthday, company”. The company’s vision of itself Mr Huntington is a “planner by trade”. changed. He came to Saatchi & Saatchi after a stint OECD Observer! as planning director at United London. “The emphasis today is more on changing He is genially outspoken, iconoclastic and behaviour”, says Mr Huntington. “Once, The Rolling Stones is a zealous and persuasive apologist for the goal was to change attitudes to a advertising in the service of the public subject in order to change behaviour. aren’t the only ones good. On his website he describes himself Now it’s the reverse: to change behaviour celebrating 50 years as having “made rodeo sexy, produced food in order to change attitudes”. Changes porn, helped men confront their fear of the in society have prompted this shift. November marks the 50th telephone, and made Sky more appealing People, Mr Huntington says, distrust anniversary of the OECD Observer, to digital refusniks”. the government, in part because of its an award-winning public magazine moral high-handedness in the past. Today, which addresses the policy Saatchi has gone from strength to people are more likely to relate to brands challenges of our times. strength since those Thatcher years, and icons. “Brands are now important when it was sought out by industries to behaviour change. So instead of making the leap to privatisation, although “government” we say “NHS” because we don’t like the government and we Blunt posters are not the preferred like the NHS.” way forward anymore Social media is largely responsible for further recent shifts in register. “Stop it has since shifted away from policy- smoking” campaigns in the UK are more Norway’s gender experience Euro area: Why solidarity matters related communications. “On the whole, positive than they were, he says, referring Israel’s progress report No 293 Q4 2012 Special focus: the agency was a favourite with fully- to the anti-smoking ads of another www.oecdobserver.org Policy in the Information World nationalised companies going private then. advertising agency. “Such campaigns But we haven’t done a lot in that arena nurture a change in behaviour through over the last ten years”. the use of emails, social media, etc. Unlike smoking campaigns 30 years ago, In fact, in politics generally, though they don’t turn up on their doorsteps and Saatchi added a communications edge shout at them. People can have their hands to famous election campaigns, and not held today, whether it is has to do with just for the Conservatives–the firm buying a Toyota or getting down to OECD Observer celebrates 50 produced the “Not Flash, Just Gordon” a healthy diet”. poster for Labour in anticipation of elections in 2007 when Gordon Brown Nor are blunt posters the preferred way took over as prime minister from Tony forward anymore. Flicking through the issues, from Blair–its involvement has declined in 1962 to today, is like taking a trip recent years, says Mr Huntington. “Our tools today allow us to have a more through modern history. Benefit genuine dialogue with people. These from our special 50th anniversary He saw signs of change in the UK with the conversations take them through the 2010 general election. One factor was voter necessary stages to get them to do subscription rates at apathy. “The decline in ideology has had a something desirable. People are acutely www.oecdbookshop.org knock-on effect on people’s passion”. aware of who is talking to them. They are more cynical and much more connected. The complete archives of For Saatchi & Saatchi, advertising has Our role is to manage that conversation”. the OECD Observer will be evolved as a concept. In fact, when Kevin Lyndon Thompson available in 2013 Roberts took over as CEO in 1997 after a shareholder revolt compelled Maurice and Visit Saatchi & Saatchi’s website at www.saatchi.com

OECD Observer No 293 Q4 2012 31 FOCUS FOCUS S pecial S pecial How the world wide web was won

Robert Cailliau, Computer Scientist and Co-Founder of the World Wide Web more significantly as Ceefax, which was an and James Gillies, Director of Communications, CERN information system accessed via television until it was closed down in October 2012. In France, Viewdata gave rise to the more interactive Minitel in the late 1970s, a secure system that was widely used around the country for consulting bank accounts and paying for airline tickets. Indeed, had history taken a slightly different turn,

Tim Berners-Lee had a paper rejected at the Hypertext ’91 conference in Texas for containing “nothing new”

Minitel might have grown to play the role the web does today. Fedida’s book, The Viewdata Revolution, still reads like a blueprint for the web.

But by 1989, Tim Berners-Lee at CERN had benefited from another technical innovation: desktop computing. After having been invented and dropped by Xerox in the 1970s, a couple of start- ups that came to be known as Apple and Microsoft made personal computing a reality.

Computer networking, which had originated simultaneously in the US and the UK, had evolved into the Internet. In the US, Paul Baran imagined a communications system that would Tim Berners-Lee and Robert Cailliau

©REUTERS/Valentin Flauraud ©REUTERS/Valentin be less vulnerable to attack from a hostile superpower than traditional Did you know that the organisation imagined access to libraries through telecommunications, whose architecture that brought you the Higgs Boson telephone and TV, and collected 16 million depended on a small number of telephone (“god particle”) also brought you the references, establishing a sort of Google on exchanges. Baran invented the concept world wide web? Robert Cailliau, filing cards. Bush, writing in the Atlantic of “packet switching”, whereby messages one of its founders, and James Gillies, Monthly at a time when the cutting edge would be cut up into small chunks, and a first-hand witness, retrace the story. of information technology was microfilm, transmitted over a very distributed network imagined a very web-like system for in which no one exchange was critical. The world wide web germinated in the organising information, and he called his In the UK, Donald Davies reached the mind of Paul Otlet in 1934, sparked the article “As we may think”. same conclusion, but with a very different imagination of Vannevar Bush in 1945, motivation. He invented packet switching developed more tangibly in the laboratory Fedida had the advantage of three decades as a way to deal with the fragmented of Sam Fedida in 1973 and was definitively of technological innovation to draw on way computers handle information. The born in the office of Tim Berners-Lee at when he developed Viewdata at the British political impetus given by the USSR CERN in 1989. General Post Office’s Martlesham Heath beating the US into space with Sputnik Research Station, and his invention went in 1957 led Eisenhower to establish the Any idea with such a pedigree has to be on to see considerable success in the UK, Advanced Research Projects Agency, or a good one, and the web certainly is. Otlet first briefly as telephone-based Prestel, but ARPA for short, to ensure that the US

32 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial

would not be taken off-guard again. In the That was the nod he needed to proceed. Farhad Anklesaria and Mark McCahill at early 1960s, when packet switching came In September of the following year, he took the University of Minnesota. The success along, ARPA was ready with the vision and delivery of a pair of NeXT cubes, the latest of Gopher led the University to invent the cash to turn the idea into the continent- thing in desktop computing produced by a very clever business model–sell the spanning computer network, ARPANET. a company established by a certain Steve servers, but distribute the client (browser) Jobs after he’d temporarily parted company for free. It was a great idea, but it came The next step came in France, where with Apple, and by Christmas 1990, he’d too soon and Gopher fizzled out. But it Louis Pouzin’s Cyclades network built written the basic foundations of the web: sparked a sort of gold rush for the web as on the advances made by ARPANET. the http protocol, the html mark-up all manner of innovative browsers for all As Pouzin once said, “we were like language, and the concept of the universal kinds of computers started to appear. One Hertz and Avis–we came second, so resource locator, URL. He’d also written in particular caught the world’s attention. we had to try harder”. Pouzin’s main the first web browser and server for NeXT Called Mosaic, it was developed at the contribution was to recognise that while computers, and a beautiful sight it was US National Center for Supercomputing networks might speak different languages, to behold. The only problem was that to Applications, and was the first browser the important thing was that information witness it, you had to have a NeXT yourself, that could be installed at a click on Macs could be exchanged between them. As he or else make your way to Tim Berners- and PCs. Mosaic morphed into Netscape, succinctly put it in a 1970s presentation, Lee’s office to see it. and this time the world took notice. The “network+network+network=network”. web had arrived, but to become worldwide, Little wonder Tim and his colleague, it would have to be as free and as widely The ARPANET would borrow from his Robert Cailliau, engineer and co-author accessible as possible. technology when it developed the protocol of this article, who had become Tim’s which defines the rules computers use first partner on the web project, met with Scene one of the final act came on to communicate with each other over the 30 April 1993 when CERN issued a Internet in 1974, known as TCP-IP. When When the French allowed Cyclades statement placing the web in the public the French allowed Cyclades to wither, domain, ensuring that the basic web to wither, some of Pouzin’s colleagues some of Pouzin’s colleagues took that technologies became an open standard idea back across the Atlantic, where they took that idea back across the Atlantic and the intellectual property of no one. teamed up with Vint Cerf, who is widely The climax came the following year, when acknowledged as the father of the Internet. limited success when they spent time Tim Berners-Lee moved to MIT to take up evangelising for the web. Tim had a paper the role of Director of the world wide web The third ingredient Berners-Lee needed rejected from the Hypertext ’91 conference Consortium, W3C. W3C is the body run by to dream up the web was hypertext, the in Texas for containing “nothing new” academic institutes and its role is to ensure point and click system of navigating (see references, OECD Observer). that the web can remain an open standard. through documents. By the end of the Nevertheless, slowly but surely, the web 1980s, hypertext systems were becoming began to grow. A key development came It’s hard to believe that there was a time, very sophisticated, able to self-correct if that year when Tim’s technical student, not so long ago, when there was no such documents were removed, for example, Nicola Pellow, wrote a very simple “line thing as the world wide web. So ubiquitous so that there was no such thing as a broken mode” browser. It had none of the has the web become that millions of us can link. Tim’s genius was to recognise that sophisticated graphics and editing capacity hardly imagine life without it. Yet, the web by doing away with that paradigm, you of Tim’s browser, but had the advantage still has a long way to go. In 1989, there could put hypertext on the Internet: that it worked on the kind of line-mode was no such thing as the world wide web. broken links would be an inconvenience terminals that were ubiquitous in research In 2005, there was no such thing as Twitter. you could live with. at the time. Suddenly, everyone in particle Who knows where the web will take us physics could use the web without having over the next couple of decades. Berners-Lee’s motivation was initially to make their way to Tim’s office. The for researchers. In 1989, he wrote a world of particle physics took notice. References memo to his boss Mike Sendall entitled Larousserie, David (2012), “Le boson de Higgs “Information management, a proposal”, Another significant moment came two découvert avec 99,9999 % de certitude”, in Le Monde, 4 July. outlining a system that would allow the years later with an ill-fated business Gillies, James (2001), “Whence the web?”, particle physics world to share information decision. Back then, the web wasn’t the in OECD Observer No 224 January. across the Internet. “Vague”, scrawled only player vying to bring the Internet Mike across the top of the document, to the masses, and the front-runner was “but exciting”. a system called Gopher developed by

OECD Observer No 293 Q4 2012 33 FOCUS FOCUS S pecial S pecial Face to Facebook with civil society

Phil Evans, Senior Consultant, FIPRA* However, this process has also created lynching of a senior ex-politician in the a series of drivers that fundamentally UK in November 2012 for an offence he change the way individuals deal with did not commit. The stream of requests each other and with all organisations and for “likes” for agenda issues on Facebook communities. We are certainly living in a seems endless. Global support is even world of the “long tail economy”, where solicited for purely national causes, like the global market, powered by information electoral reform and legislation on same- and communication technology is sex marriages. In fact, the entry barrier is allowing more people in more places to low for just about any “campaign” you care buy more things from more sellers based to set up. in more countries. Are we also seeing the emergence of “long tail politics” to go What does this long tail politics mean with it? for governments and civil society? The answer may not be particularly welcome After all, it is quite common to see political or social “campaigns” spread The zero entry barriers may globalise across the world of Facebook in hours and communication, but they atomise days demanding change to one policy or another. Twitter can erupt with gossip and campaigning accusation and can precede conventional ©Tomas Bravo/Reuters ©Tomas broadcasters by vital minutes in breaking news. The zero entry barriers may Democracy is a good thing; news stories. globalise communication, but they atomise transparency is too, and so is campaigning and severely undermine the openness. Nothing too controversial In the “old” days political campaigns were ability of civil society groups to edit and in this statement, you might think. high cost for organisers and participants. mediate messages, and then communicate The veil of ignorance is slowly but They required real sacrifices and effort to them succinctly or pointedly to politicians get them going. They were almost entirely and government bodies. steadily being lifted from the eyes of driven by vanguard communities acting the general public across the world collectively to exert pressure for change. This atomisation lends itself most to the thanks to thriving media, innovation Look at the Suffragettes, the trade unions “funny cat video” of politics, and garnering in global communications and the in the 19th century and the Civil Rights simplistic crowd support for, say, providing pressure on governments to open up movement, to name but a few. shelter for homeless pets. The idea that and reach out. expressing a “like”, “sharing” an image or The quest for change was difficult and political sentiment, or re-posting a tweet There has been a revolution of highly organised. NGOs and political is in any way comparable to campaigning accountability and transparency. parties formed around these communities is underlined by the real and often Many politicians and government or co-opted them to their own ends. apocryphal stories of the power of social departments in many parts of the world These groups became mouthpieces that media for force change. While the change now have a web presence and publish could think collectively and separate the is almost always minor in a wider political documents on it; many now respond to wheat from the chaff. The dialogue for sense it seems major in a 24 hour news emails and some even enter into dialogue campaigning was focused and deliverable– cycle fed by a social media driven world. through Facebook and Twitter. and was executed in disciplined ways. The atomisation of politics can really be Revolutions do not tend to go into reverse, Enter the “long tail” political world where traced back to the end of the Cold War and people rightly expect this flood of the barrier to creating such communities and the collapse of ideologically driven information and transparency to continue has collapsed. Everyone has a voice and politics. While we have not quite witnessed stronger, which has forced many in everyone has the means to use it. But is the end of history, we have seen long government to change the way they deal this an unalloyed “good thing”? tail politics unite huge communities of with civil society and the wider world. In people but often in shallow and politically turn, the spread of the web and social It is certainly not risk-free. The ability of irrelevant ways. media provides campaign groups with new social media to spread even erroneous opportunities and avenues to reach out to and dangerous rumours like wildfire can The worst side effect of this is that these individuals directly. have profound effects, as witness the atomised individuals believe that they are

34 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS S pecial S pecial The OECD Observer story

making a difference, and so have ticked Thumb through and you will find their box of political or social activism. photographs of well-known personalities In fact, that tick may mark a huge increase in their heyday running policy meetings in their involvement. here: Gro Harlem Brundtland, Alan Greenspan, Garret Fitzgerald, and a We have also seen the merging of the sprightly Jacques Chirac to name but a few. long tail of politics with more established forms of activism in the form of the Many articles serve as a sharp reminder Occupy movement and the Arab Spring. that many policy challenges still persist, Movements such as these, despite for instance, concerning the environment, their shortcomings, at least challenged the taxation of company profits, and Facebookers to get up and get out, and development. The first article in the first connected social media to the kind of edition in November 1962 asks “What political activism that ultimately can force makes an economy grow?”, and a June change. November marks the 50th anniversary of 1970 piece says that the main obstacle to the OECD Observer, the award-winning efficiency in financial markets is the lack of The more we pander to social media public magazine of the OECD. The information. How we all would have done only, the more we risk infantilising brainchild of Thorkil Kristensen, the first well to read that article again before the political messages and marginalising secretary general of the organisation, the current crisis! “hard work” political issues. The challenge OECD Observer was launched at the 2nd for civil society perhaps even more than Solid references have long shelf lives, and governments (who at least focus their The full digital archive of the OECD articles like Angus Maddison’s “The West efforts on old-fashioned elections) is how and the Rest” epic in the 40th anniversary to engage an atomised class of people Observer dating back to 1962 will be edition, Flip de Kam and Chiara Bronchi’s whose communities are many and diverse available in 2013 “The income taxes you really pay”, and a and often geographically dispersed. 1968 piece on student unrest by George ministerial meeting 27-28 November Papadopoulos are still requested today. Issues that cannot be boiled down into 1962. He recruited a former war resistant One of the most popular articles is about “cute cat video politics” or a “like” may find and political journalist from his native school bullying, written in 1999 by themselves marginalised. Those with real Denmark, Anker Randsholt, to do the job. Norwegian scholar Dan Olweus. It still political power may use the increasingly The audience? Busy policymakers who had gets online comments, sometimes (sadly) infantilised political dialogue as a handy no time “to read more than a fraction” from victims of bullying. mask, and a distraction from the real issues. of the OECD’s already considerable and Global challenges, like climate change, may somewhat technical work. In a sector which has seen Newsweek gain but for the vast majority of political and many other magazines go online, if issues a simple like/dislike or retweet In effect, the OECD Observer became not to the wall, the OECD Observer has simply cannot manage the complexity a public gateway to the work of the innovated to stay ahead. In fact, thumbing of reality. organisation, while filling other roles along through the archive will soon be replaced the way: a podium for discussing policy by browsing it, as the entire 50 years worth Moving people from low cost tweeting and unlocking tough ideas; an academic of digital archives will be rolled out on and “liking” to real, high-cost, engagement reference; and a rich and compelling all platforms in the New Year. Hopefully, will involve more than a mere click of archive. today’s OECD Observer will be read with imagination and engagement. So let’s interest in years to come. embrace social media, but not con ourselves Flicking through old issues is like taking Rory Clarke, Editor-in-Chief since 1999 into thinking it can change the world on a trip through modern history. From a its own. heartfelt obituary for John F Kennedy All cited articles can be searched online or found at www. penned by Mr Kristensen in December oecdobserver.org except: *Fipra, the Finsbury International Policy & Regulatory 1963 through the landing on the moon Papadopoulos, George (1968), Student unrest: Impact Advisers, is one of Europe’s leading public affairs in 1969, the oil crisis of the early 1970s, on educational systems, the economy and society in consultancy networks, advising on a range of general, in OECD Observer, No 37, December, available privatisation in the 1980s, the information government relations and regulatory policy issues. on request to [email protected]. revolution and globalisation in the 1990s, Visit www.Fipra.com Svennilson, Ingvar (1962), What makes an economy to the economic crisis now: the OECD grow? The role of research and education, in Evans, Phil (2003), “Home truths, globalisation and OECD Observer captures the story of our times. Observer No 1, November competition: Making trade work” in OECD Observer No. 240-241, December.

OECD Observer No 293 Q4 2012 35 FOCUS FOCUS S pecial S pecial Beyond blogonomics

Henry Copeland, CEO, Blogads and Pressflex.com the new headlines, then retweeters are More recently, Twitter and Instagram the new editors. have exploded because they’re perfectly configured for creating, sharing and So what about print? The other day consuming snack-size content on I heard a management consultant say, smartphones. in all seriousness, that “print will survive because we need something to read while Even Google is being squeezed, not by the jet is taking off.” A narrow niche the sheer volume of content, but by the indeed, and probably too narrow. Sadly, number of new modes of cyber activity– the looming collapse of print hurts likes, retweets, shares–which create a more than those who own printing universe of online conversations that lie presses–many studies indicate that people beyond the reach of Google’s robots. remember more from the printed page than the screen. So maybe printed objects Next up, the tablet. In the next decade will stage a comeback as a status fetish we’ll see one or more of the tablet’s unique among connoisseurs, just as vinyl has qualities–its large-yet-portable form factor, for music records. I doubt we’ll see a swipability, and bed-side convenience proximity print-on-demand boom… who –fertilise some amazing new tools or wants to buy more printer cartridges? knowledge formats. ©Blogads In 2002 Henry Copeland, chief of Looking at media five years ahead, I take a That new micro-targeting technology to Blogads and Pressflex.com, wrote Marxist view: the means of production and grab out pull quotes will help journalists about how blogs, largely unknown at consumption will continue to dictate the and researchers for instance. If pushed, the time, would change web writing shape of our knowledge and interactions. I’d bet on something like DoodleorDie, and publishing forever. He was right. which is a drawn variation on the old Then in 2008 in these pages, he told Google is being squeezed by a new parlour game Exquisite Corpse. us to bet on Twitter several months universe of online conversations that And history won’t end with the tablet. before it took off (the OECD opened lie beyond the reach of its robots Ten years from now smartphones and its first accounts in April 2009). tablets will have been replaced by some So where is the information world And the main factors of production will new configuration of form, factor and taking us now? Henry provides be labour–which means there will be functionality, and we’ll see the emergence some fresh thoughts. increasing employment of people who of entirely new media configurations and create content in finer and finer niches. idioms, to fill those vessels. We’re heading for more of the same, And finer and finer technology, with micro- only faster. The old gatekeepers–the qualities that meet niche demands, such Visit www.blogads.com publishers who owned printing presses as a device that allows you instantly Copeland, Henry (2012), “Blogonomics, ten years on”, and broadcast towers–are being squeezed to glean and share your favourite pull- available at Blogads.com, May 28. from two sides. Individuals now create quotes–a perfect device for a journal such OECD Observer (2008), “Internet time”, Interview with Henry Copeland, No 268, June. far more content, whether on blogs, as the OECD Observer! Craigslist, Instagram, Rapgenius, Wikipedia or Youtube–than traditional But let’s recall how this model of media publishers. And people increasingly rely history has played out online to date. Information is action

on peer judgments–via the likes of Starting more than a decade ago, blogs oecd A c rit c a lin fra s tru c tu re Spreading broadband Ob T h e n e x ts e v e ra lb il o n u s e rs serverF ig h tin g m a lw a re No 268 July 2008 www.oecdobserver.org Television’s convergence Facebook, Twitter, Reddit and Google– OECD MINISTERIAL MEETING SPECIAL SEOUL, KOREA, 17-18 JUNE 2008 D o n a tin g y o u rP C to s c ie n c e excelled because they were the first content In 2013 the A s m a le rw o rld ? rather than consuming what publishers format to fully embody the qualities that Internet OECD Observer economy and broadcasters can afford to serve them. distinguish the web from print: easy A closer look publishing, plentiful linking to other archive will be Publishers are starting to realise that the web sources, infinite page scrolling, and released online. game is now “out there” and not inside a constant streaming information for their walled gardens. Readers want to be readers craving news and excitement catered to via the platform or functionality throughout the workday which they Contact [email protected] of their choice. In short, if tweets are could comment on directly.

36 POLICYMAKING AND THE INFORMATION REVOLUTION FOCUS FOCUS Last word S pecial S pecial Up in the air?

Rolf Alter, Director, OECD Directorate for Public Governance and Territorial Development need in the wonderful brave new world of information and knowledge will appear before you.

So, here’s a knowledge management tip, provided you do not mind leaving a carbon footprint behind: take as many intercontinental flights as you can so that you can read all the documents and watch the speeches from the conference you missed when answering your emails from HQ. Your flight is no longer just for catching up on rest. It’s your new workplace!

Try it out for a while. And then do your fellow frequent travellers a favour. Imagine, for instance, you have developed some very innovative insights into Mobile- Government (MG) you wish to discuss. Next step: organise a seminar on how citizens can better communicate with their governments 24/7. Given the absolute ©REUTERS/Felipe Caicedo ©REUTERS/Felipe novelty of 24/7/MG, you can expect quite Taking as many long-haul flights as After all, how many of you really benefit a fascinating and cutting-edge crowd to possible could hold the answer to your from face-to-face meetings, seminars and turn up. knowledge management problems. conferences? There was a time when I did. That was quite a long time ago, though, And so they will. But I return to the statistical fact I mentioned at the start Recent crowd sourcing reveals that when attending meetings in person was (that is, if you didn’t miss it when your frequent travellers regularly complain considered a privilege. But this is no longer smartphone distracted you while reading about the stress that comes with spending the case. Nowadays, as far as I can see, this): that rather than engage in a real live hours on a plane, and having to suffer exchange of ideas, 75% of your guests through transfers at congested airports. How many of you really benefit from will be looking at their Blackberries or Do you belong to this “unhappy” crowd? face-to-face meetings? smartphones instead, probably reading Think again. For you should smile, sit messages from government officials who back and learn to savour those long-haul are themselves currently up in the air. flights. Why? most of the people attending conferences seem to be more engrossed in what is But look on the bright side. Your guests Because of the rare privilege they offer of happening outside the room than in it. will be grateful to you for giving them being cut off from e-mails, SMS texting, They are too involved in their Blackberries, another golden opportunity to take a blogs, Facebook, Twitter and all the rest of smartphones, tablets and laptops to be long flight to your meeting so that they it. No apps either. Just you, your creative bothered with the meeting at all. You can catch up with the previous meeting thinking and time for reflection (and may wonder why they came or what they they also “missed”. On the way back possibly this printed magazine to pore hope to get out of it. Are they driven by home they will plug in the USB key you over too). But you will also have time to addiction, or masochism? gave them at the MG conference, and prepare the next batch of surprise e-mails prepare comments on the video of your to bombard your collaborators with as soon Well, neither of these. Let’s call it a presentation, which they will then send as you land. You can fire them off from behavioural change, observed since the you before that morning jog. It’s a win-win your hotel in the middle of the night or days the “hard copy guys” were sent for everyone, as long as their ideas don’t before going jogging in the wee hours of a packing. The e-world is so much more stay up in the clouds. glorious morning. Why wouldn’t you wish convenient. No more carrying around all those heavy books and reports. Just for this “time-out” to stay? Visit www.oecd.org/gov switch on your iPad and everything you

OECD Observer No 293 Q4 2012 37 Your Better Life Index There is more to life than the cold numbers of GDP Your Better Life Index enables you to rate countries and economic growth. Your Better Life Index allows according to the importance you give to the 11 topics. you to compare well-being across different countries, You can compare your well-being priorities with those based on 11 topics the OECD has identified as essential, of other users by country, age and gender, and share in the areas of material living conditions and quality your results. of life. Each petal of the flower represents one topic and the size of the petal the country’s rating for that Create Your Better Life Index at: topic. The height of the flower shows the country’s overall rating. www.oecdbetterlifeindex.org Compare your quality of life with other countries

Find out more about how life compares in OECD countries by ordering the book, How’s Life? Measuring Well-Being. Available now on the OECD Online Bookshop: http://www.oecd.org/bookshop Policy can brighten the economic outlook

Pier Carlo Padoan, Chief Economist and Deputy Secretary-General of the OECD This time it’s different OECD-wide domestic demand before and after recessions, quarters; GDP peak at time t After five years of crisis, the global Domestic demand 1970s; Peak at time t: 1974Q3 economy is weakening again. In this index (at time t) 1980s; Peak at time t: 1980Q1 we are not facing a new pattern. Over the 2000s; Peak at time t: 2008Q1 1.20 1.20 recent past, signs of emergence from the crisis have more than once given way to 1.15 1.15 a renewed slowdown or even a double-dip 1.10 1.10 recession in some countries. The risk of a new major contraction cannot be ruled 1.05 1.05

out. A recession is ongoing in the euro 1.00 1.00 area, the US economy is growing but below what was expected earlier this 0.95 0.95 year, and a slowdown has surfaced in 0.90 0.90 many emerging market economies. t-4 t-2 t t+2 t+4 t+6 t+8 t+10 t+12 t+14 t+16 t+18 Source: OECD Economic Outlook, Volume 2012/2 http://dx.doi.org/10.1787/888932742741 The weaker outlook has several causes. A significant drop in confidence is a key driver. Efforts at deleveraging public and On the fiscal front, countries should additional quantitative easing, though private debt and reining in government avoid going too far too quickly, as any being careful to end any unconventional budgets have had a particularly strong knock-on effects on the wider economy measures as soon as the worst is over. are likely to be large. US budgetary Temporary fiscal stimulus should be Our common challenge is to guide tightening should proceed at a more provided by countries with robust measured pace to avoid the “fiscal cliff” budgetary positions, particularly the global economy forward on a new that current legislation implies. Germany and China. Other economies long-term path may have to ease up on their budgetary In the euro area, structural budgetary tightening plans. impact on our economies, while weaker tightening should be limited to current global trade adds to the gloom. High fiscal commitments, and automatic As to structural reforms, these should unemployment is further depressing stabilisers be given full leeway around be fully implemented, as they could begin confidence and spending. Slow and this. To maintain credibility, European delivering sooner than expected in terms ineffective policy responses have not governments should announce this of higher growth, better employment helped the situation. commitment in a coordinated fashion. performance and more balanced current Underlying budget trends are already accounts. Yet, a strong policy response using improving in many euro area countries every policy tool available can turn the and debt-to-GDP ratios will start to fall Putting in place strong institutions, such downside scenario around and secure in the coming years, which would in as independent fiscal councils, or drawing more sustainable growth. However, turn bolster confidence. up credible fiscal rules, can reassure failure to take such action could push markets and provide additional support. the global economy back into recession. In Japan, a detailed and credible Moreover, progress towards a fully fledged medium-term fiscal consolidation banking union in the euro area is essential. What can be done? For a start, the programme needs to be established. monetary policy stance of several There, the high level of debt limits the The global nature of the current slowdown economies should be further eased, room for manoeuvre, and could prevent is a reminder of how interdependent our particularly in the euro area, Japan and automatic stabilisers from working world has become. Policymakers must take some emerging market economies, properly in the event of a shock. spillovers and transmission channels more including China and India. In the US, seriously on board, particularly in the G20, policy, which has already been eased, What if downside risks materialised? when addressing global imbalances and is now at an appropriate level and should First, central banks should provide greater the impact of monetary policies on capital be held there, given weak inflation liquidity injections, purchasing private flows and exchange rates. prospects and the slow growth in jobs. sector financial assets and possibly

40 ECONOMY

Our common policy challenge is to guide trade-offs will have to be better measured, the global economy forward on a new new sources of growth, such as green long-term path. This requires departing energy and innovation in knowledge-based Happy birthday, from the pre-crisis business-as-usual intangible assets, must play a more central approaches. In addition to repairing the role in the future. financial system, we must find ways to For more on OECD Economic Outlook No 92, OECD Observer! ensure environmental sustainability and visit www.oecd.org/eco/economicoutlook.htm November marks the 50th Order it at www.oecd.org/bookshop tackle rising inequality. Though potential anniversary of the OECD Observer, an award-winning magazine which addresses the policy challenges of our times. Spanish immigrants

The art of making reform happen Interview: Felipe Kast The obesity challenge Medical tourism Tackling rare diseases Making artificial cells? Twenty years ago Spain was lauded Another issue is how to better avail www.oecdobserver.org Banking stress test No 281 October 2010 by economists as a new and emerging of immigration: the proportion of star. However, in productivity terms foreigners in Spain has increased A cure for health it never quite fulfilled its potential. sharply over the last decade, from costs Immigrants face the crisis Part-time work Why? This rather technical but very 1.6% in 1998 to 12.2% in 2010. The income taxes you really pay Economic outlook No 280 July 2010 readable working paper by the Moreover, foreigners are relatively www.oecdobserver.org OECD’s Andrés Fuentes and the highly educated, yet this immigration Bank of Spain’s Juan S Mora has not boosted productivity, partly Sanguinetti, helps to answer the because many (sometimes over- Confidence question, by looking at issues such as qualified) immigrants end up in The missing factor poor growth in total factor productivity, labour intensive sectors with below which reflects technology and skills, average productivity. Freeing up the and how labour and capital operate labour market would help resolve such Chile and the OECD Is financial stability enough? Copenhagen: No cop out A closer look at US healthcare costs together. problems, the authors suggest. www.oecdobserver.org Tax for development No 276-277 December 2009-January 2010 Israel’s economy OECD Economic Outlook: Country snapshots Economic outlook Foreign assets How fragile? Educational attainment, nationals and immigrants, Spain, Q1 2011

Nationals Foreigners 2011 Q1 2011 Q1

Primary education 12.1 19.9 Secondary education 29.7 21.8 (primera etapa y formación e th inserción laboral correspondiente) Benefit from our special 50 anniversary subscription rates at Secondary education 21.7 34.8 www.oecdbookshop.org (segunda etapa y formación e inserción laboral correspondiente) The complete archives of Tertiary education (except Ph.D) 35.4 21.3 the OECD Observer will be available in 2013 Source: OECD Economics Department Working Papers No 973

Mora Sanguinetti, J. S. and A. Fuentes (2012), “An Analysis of Productivity Performance in Spain Before and During the Crisis: Exploring the Role of Institutions”, OECD Economics Department Working Papers, No. 973, OECD Publishing. Available on www.oecd-ilibrary.org

OECD Observer No 293 Q4 2012 41 Energy efficiency: A true alternative

Interview with Fatih Birol, Chief Economist to fuel it. We expect this to continue as and OECD over several years, where we and Director of Global Energy Economics, the number of passenger cars doubles have looked at subsidies to consumers and International Energy Agency (IEA) to 1.7 billion in 2035, which is the end the OECD has studied the producer side. of our outlook period. Second, the cost of bringing oil to market is rising as Many policymakers are eager to push companies must increasingly turn to for greener, smarter energy mixes. What more difficult-to-produce sources, such information and knowledge gaps have as oil sands and light tight oil in North to be filled to ensure that the route they America, and deepwater offshore take is indeed smarter? production in Brazil. Renewable energy is a vital component to our future energy mix, but their higher Could (and should) governments do cost remains one of the main challenges more to bring down oil prices? to increasing deployment. In World Energy In terms of lowering oil prices, there Outlook 2012, we expect that renewables is unfortunately not much scope for will enter the mainstream in power government action that can change the generation, accounting for half of new aforementioned market fundamentals. global capacity additions. This projection The best recourse for oil-consuming hinges on sufficient government support countries to avoid prices going even higher being available to renewables, though and to deal with the adverse impacts they will become more competitive over of high oil prices is to encourage more time–onshore wind, for example, becomes competitive in some regions in our outlook.

©OECD/IEA 2008 ©OECD/IEA But if I were placing bets, mine The design of renewables support schemes The IEA’s World Energy Outlook 2012 would be on energy efficiency is critical to their success, particularly as was released in November. Though oil governments are facing budget austerity. prices are at historic highs, the future efficient oil use. It may seem obvious, Renewables subsidies came to $88 billion for energy is promising, provided the but a sure way to halve your bill for in 2011, a figure dwarfed by the amount right policies are in place. petrol is to double the fuel economy that went to fossil fuels. In thinking of your vehicle. We estimate that about how governments should proceed OECD Observer: How high are improvement potential for vehicle fuel in supporting renewables, they should oil prices as we approach 2013? economy through to 2035 is substantial, first and foremost provide a predictable Fatih Birol: High oil prices are putting at up to two-thirds, compared with an and transparent framework. Renewable a brake on economic growth, which is average vehicle today. This can be achieved energy policy should be a part of overall particularly worrying where activity has affordably with existing technologies, energy strategy and policymakers should been sluggish. You might remember that but it is critical that the right policies are focus on a portfolio of renewables that is they dipped to just above $30 per barrel in in place to prompt their uptake, namely best suited to their country. This strategy the midst of the financial crisis at the end progressively ambitious fuel-economy should be backed up by ambitious but of 2008. Since that time oil prices have standards and labelling. credible targets, as well as subsidies that averaged more than $90, which is triple are differentiated according to the maturity their average in the two decades prior, Another policy that governments should of each technology and flexible enough to and are currently above $100. pursue is the elimination of subsidies to respond to changes in technology costs. oil products, which might be tempting to System integration is a related issue that That high oil prices have been sustained shield consumers from the effects of high must be addressed. reinforces an important message that I prices, but ultimately promote wasteful have spread for several years and is again use of resources and stifle the adoption of What alternative energy source do you clear from the analysis in the World Energy more efficient behaviour and technologies. see as being the most promising? Outlook 2012: the era of cheap oil is over. We estimate that the cost of price subsidies It’s important to recognise that a full The basic trends supporting this view to fossil fuels was $523 billion in 2011, the suite of energy sources will be needed. are two-fold. First, the rise of emerging bulk going to oil products. This estimate In most cases, this is the best approach economies like China and India has is derived from complementary work on for developing a robust energy system, pushed up demand for mobility and oil fossil-fuel subsidies undertaken by the IEA as opposed to picking only one or two

42 ECONOMY

per unit of GDP generated–and paring Energy alternatives back its use where alternatives exist. Oil Reduction in global oil demand in the Efficient World Scenario compared represented just over a quarter of power with the New Policies Scenario, millions barrels/day generation in OECD countries prior to the first oil shock in the 1970s. Today mb/d 100 that share is down to 3% and falling. New Policies Scenario Oil dependence has also been drastically 98 reduced in industry and buildings and 96 should continue to decline.

94 But transport represents a unique 92 challenge. Unlike other sectors we do not yet have cheaper, scalable alternatives 90 to oil and the internal combustion engine. Because of its high energy density, oil 88 Efficient World Scenario still gives us the greatest “bang for our 86 buck”. But higher oil prices will send a strong economic signal to consumers, 84 incentivising them to reduce their use. 2010 2015 2020 2025 2030 2035 Their two options are to consume oil Buildings Power generation Transport more efficiently or to use other fuels, Industry and heat Other sectors such as biofuels or natural gas, which can substitute for oil, albeit generally on winners. But if I were placing bets, mine by Russia and Norway today (see chart); a small scale. I believe that improved would be on energy efficiency. natural gas saved would be equivalent to vehicle efficiency is the most effective tool US gas demand in 2010. available for cutting oil use in transport. Though it is not a fuel in the traditional Of course, technology breakthroughs sense, greater energy efficiency can help There are important benefits for the could occur that propel us towards an satisfy rising energy demand just as environment, delaying by five years oil-free future–in batteries and electric effectively as increasing energy supply. (to 2022) the date at which we become vehicles, for instance–but they are very

Importantly, it can do so economically and locked in to a CO2 emissions pathway difficult to predict. without sacrificing the extent and quality that leads to an average global temperature of services we receive. Energy efficiency increase of 2° Celsius. This time may be For more information on the World Energy presents a huge opportunity, yet in our precious for governments to take action Outlook 2012, including an executive summary, factsheets and other multilingual materials, visit central scenario assumed policies would to mitigate climate change. And critically, www.worldenergyoutlook.org/publications/weo-2012 put us on track to achieve just a third of the additional investment that would be See also www.iea.org its potential by 2035. needed in energy efficiency to achieve www.oecd.org/greengrowth those energy savings would be more than To understand just how compelling the offset by savings in fuel expenditures by case is, we designed a special scenario that households and businesses. We estimate shows the energy security, environmental the scenario would see a 20% savings in Order this now! and economic benefits attainable if we fuel bills, among other economic benefits. were to systematically adopt known best Power information technologies and practices to improve Could our countries still be oil energy efficiency on a global level. In this dependent in 50 years time? “Efficient World Scenario” global energy I would be rather surprised if we are Browse and demand is reduced by half compared with not using oil 50 years from now. That order at the New Policies Scenario, which is our said, I think that we will use it much www.oecd.org/ central scenario. In particular, there is more efficiently at that time, and almost bookshop large potential to reduce demand for fossil exclusively in transport. Many economies fuels: the amount of oil saved, 13 mb/d in have come quite a long way already in 2035, would be equivalent to that produced reducing their oil intensity–oil demand

OECD Observer No 293 Q4 2012 43 The euro: A message of solidarity

Charles Jenkins, Writer, Commentator and former Director of Western Europe Country Analysis, make foolish investments both in the Economist Intelligence Unit, London* US and in the euro area, just as much as it afflicted Greece or France.

It seemed all Europe had to do was take on new members, as it did as recently as May 2004 when the union expanded from 15 to 25 members. Ireland, now a country mired in crisis, presided over the EU that year, and as the Irish ambassador to the OECD, John Rowan, remarked in the OECD Observer at the time, it was an unprecedented “Day of Welcomes”.

But while the economy boomed, efforts to build a stronger Europe received a huge setback with the defeats in referendums in France and the Netherlands of the Constitutional Treaty in 2005; the eventual Treaty of Lisbon failed to address Europe’s weaknesses. How the crisis has brought everyone crashing back to earth.

Yet the 1980s and 1990s were periods of movement and achievement for the EU, a customs union riddled with non-tariff barriers, and it was transformed into a genuine, if still incomplete, internal market between 1985 and 1992.

Remember also that following the end The EU’s crisis has as much to do politics–runs counter to Schuman’s vision of the post-Second World War division with leadership and solidarity as and is weakening the foundations which of Europe, Germany was re-unified by resolving fiscal and debt problems. he, together with Jean Monnet, laid out its inclusion in the Federal Republic It is time to dispense with caricatures for the EU way back in the 1950s. With in 1990 of the previously communist and write the next chapter in the EU’s new signs of crisis or falling confidence East Germany. It was a huge step to ongoing history. And for that, clear almost every week, rarely has Europe take. The EU also gave support to the and transparent data will be needed. looked so vulnerable. transformation of other former communist economies, and commenced an accession “Europe will not be made all at once, How did it all go so wrong? How can process designed to transform them into or according to a single plan. It will be Europe be put back on track? Does this rounded democracies. On the basis of built through concrete achievements which crisis spell the end of the euro or, as its the Maastricht treaty of 1992, the road first create a de facto solidarity.” These are first real test, will it jolt European leaders was paved for a single currency amongst the words of Robert Schuman, one of the into writing the next vital chapter in initially 11 countries, and the euro was founding fathers of the EU. The solidarity Europe’s story of ever closer union? created between 1999 and 2001. he was referring to in 1950 has been built up over six decades, but is now being Building the EU was never going to be The making of Europe is about other sorely tested. easy. The boom period until 2008 blinded policy initiatives too. At the beginning many of us to some stark realities about of the 2000s, new environmental (20% What is happening today in Greece and a work very much in progress. This less greenhouse gases, 20% more energy threatens to happen elsewhere–the scenes blindness afflicted Germany which efficiency and 20% renewable energy) of violent protest, increasing numbers breached the euro area’s original 3% and social goals (70% employment rates, of destitute people being provided with fiscal limit (on which Germany itself had poverty reduction) and competitiveness food by charities, extremist and divisive insisted) and which allowed its banks to (research and development spending at 3%

44 ECONOMY

of GDP) were established. These initiatives which uses about a third of that budget to reliable, relevant and well-presented have had much less impact on the public help poorer countries and regions; this is statistical data. In fact, some of the failures than did the building of the single market not likely to be significantly increased. that prepared the ground for the present and single currency, but they reflected crisis across the euro area can be ascribed shared ambitions and a desire for solidarity In fact, financial flows from banks in to poor statistics, not least the presentation to meet common problems. It is this stronger countries to weaker countries of government finances in ways which cast solidarity which appears to have taken during much of the 2000s were a cause them in an excessively favourable light. the severest blow in the crisis. of the problem, since they allowed the This opaqueness has weakened the basis latter to grow demand more rapidly than of the EU project. There was already a feeling of loss of they should have by running external direction when, in late 2008, the US current account deficits and building up Transparent, clear communications are subprime crisis led to bank collapses external debts. The extent of these flows needed. The status of the EU’s statistical across the EU leading to a deep recession, resulted from mistakes made by banks agency, Eurostat, should be enhanced, which in turn set off sovereign debt crises and their regulators in the stronger and should be moved from Luxembourg to countries as well as from mistakes the European Commission’s main offices According to opinion polls, all euro area by those in the weaker ones. Banks in Brussels, given that it is a crucial part of countries would prefer to stay in the that made unwise decisions to borrow the work of the Commission’s Directorate were complemented by banks that made General for Economic and Financial single currency to avoid the negative unwise decisions to lend. Hopefully, the Affairs, with which it should co-operate consequences of a break-up creation of a banking union will help more closely. It needs to have the authority address this problem. to confront member states where there in the periphery of the euro area. Since are reasons to suspect that they are not then the EU project has been buffeted by The trouble is, the economic cost of these providing reliable information. Accessible a succession of crises, and it has gone from mistakes has fallen overwhelmingly on and reliable statistics are crucial at a time one to the next, followed by accusations the weaker countries. If the principle of when weakened economies need to be of having no clear objectives or sense of solidarity is to be applied, the stronger nursed back to health. direction–as if survival in a crisis were not countries must be prepared to take some a sufficient goal in itself. Indeed, according financial losses–in effect, they must share to opinion polls all euro area countries some of the pain, as well as the cost, of the would prefer to stay in the single currency imbalances they helped to create. It is in Order this now! to avoid the negative consequences of their own interest to act constructively to a break-up. In an ironic way, this is a make recovery of the troubled countries Euro fundamentals testimony to the EU’s solidarity, but a more feasible rather than forcing them into optimistic narrative is now needed to keep such deep and painful austerity as to make the EU and its citizens moving forward. recovery impossible. Browse and order at www.oecd.org/bookshop Sticking together For example, Germany, the Netherlands A new and more positive view of the and Finland should not try to backtrack, euro area and the wider EU requires the as they have done, on the agreement of ability for all players to openly admit the June European Council to no longer past mistakes, an appreciation of shared require lending to Spain’s banks to be interests in finding a way out of the guaranteed by the Spanish state. That crisis and a consequent sense in which move is vitally important to give Spain the membership of the EU, especially the chance to escape the lethal interaction of euro area, requires solidarity to get the banking and sovereign debt crises. The through testing times. politicians in the stronger countries should point out to their sceptical voters that they Solidarity does not need to be interpreted have a strong self-interest in the recovery as requiring the richer, stronger countries of the currently weaker economies, to provide long-term financial transfers to because it is the only way that the creditors those in difficulty, the so-called “transfer can hope to be paid back. union” which stronger nations fear being cajoled into. The EU budget, totalling only Solidarity and good governance depend 1% of its GDP, already has a regional policy crucially on good information, including

OECD Observer No 293 Q4 2012 45 Business brief

Solidarity does not mean allowing any country to avoid responsibility for taking “We assume our share of the painful measures to close fiscal deficits. responsibility for the crisis, But this accusation cannot be levelled at but we are also part of the any of the EU’s vulnerable countries, solution” Frédéric Oudéa and especially not Greece, where take- home pay by public servants has been though they were an easy target, everyone slashed by up to 50% since 2008. now knows that without them, recovery Solidarity does mean taking account would not be possible. We need to feed of the condition of the economies for savings back into the economy. This is which fiscal prescriptions are made. extremely important, and to achieve it, we need to rely on a stable and efficient Eurostat and the European Central Bank banking system. The crisis particularly should also provide clear and well- highlighted the importance of liquidity to publicised statistics on levels of private irrigate the system. At the end of the day, (household and corporate) debt as well as

©Societe Generale the financial crisis cost us dearly, but we public debt. The OECD which has long have collectively learned a great deal. provided reliable comparative data, could Earlier in 2012 Frédéric Oudéa, play a monitoring role. No longer can it Chairman and CEO, Societe Generale Frédéric Oudéa: For the past five years, be argued that public debt does not matter Group, met OECD Secretary-General we have indeed been living through a as long as it is balanced by private savings. financial crisis, and the tremor which Economists said this for years about Italy. Angel Gurría to discuss the global occurred in summer 2011 was an But private savings are volatile, and can economy, the business scene and aftershock of the original earthquake. flee the country too. Equally, it should not the financial crisis. Here is an I share Angel Gurría’s lucid and optimistic be considered that, if public debt is low, extract from their conversation. view. The economies of developed the rise of private debt does not matter. countries are going through a serious As has been shown in Ireland and Spain, How would you analyse the latest crisis, having relied too heavily on debt. the unwinding of private debt can lead to financial crisis? The banks which supplied the debt are, rapidly rising public debt and economic Angel Gurría: You talk of the “latest” in a way, the symptom of the imbalance collapse. financial crisis, but in reality, we haven’t overcome the one that began five years which has now appeared. We assume our share of the responsibility for the crisis, A message of a shared destiny, combined ago with the subprime mortgage crisis, but we are also part of the solution. Let’s with reliable facts, is the only way to which then spread to the markets and later look at the economy from an international combat the caricatures and myths the entire economy, affecting economic perspective. One of the key issues for developing in some countries about the future of the world’s economy is their fellow euro countries, which risk “The financial crisis has cost us dearly shifting savings towards areas requiring pulling the euro area apart and de-railing but we have collectively learned a finance. Countries such as China, India, the whole European project. great deal” Angel Gurría Brazil and Russia will have to invest *Charles Jenkins ran the Europe desk of the Economist hundreds of billions of dollars every year Intelligence Unit (EIU) from 1976 until his retirement in growth and unemployment, particularly in infrastructure, and they won’t be able 2012. A commentator on European affairs, he launched for young people, which is a real tragedy. to do it alone. I cannot see who can help various influential EU reports, has written and lectured them more than the banks and financial extensively and has been a strong advocate of European The responsibility for the crisis, which unity. His father, Roy Jenkins, was president of the nobody really saw coming, should be markets. Working out how to finance European Commission from 1977 to 1981. The views borne by all of us. growth effectively and securely for those expressed in this article are the author’s alone. who save and helping the world’s economy But it has had at least one positive effect: create wealth are the real objectives, which References it has encouraged people to act more take us beyond the euro zone crisis. For more views by Charles Jenkins, wisely. It has encouraged governments to see www.insighteu.com English translation and copyright by Societe Generale be more careful about their public finances, 2012. For the full conversation, see “Economy and Rowan, John (2004), “EU enlargement and the and regulators to take their role more Strategy: Viewpoints”, in Activity and Sustainable OECD: A new era”, in OECD Observer No 243 May. seriously, while individuals get themselves Development Report 2011-2012, Societe Generale, Schuman, Robert (1950), , The Schuman Declaration less into debt. As for the banks, even France. 9 May.

46 UNIVERSAL BANK ONE BANK 33 MILLION CLIENTS ONE TEAM SPIRIT

RETAIL BANKING - CORPORATE & INVESTMENT BANKING - SPECIALISED FINANCIAL SERVICES & INSURANCE - PRIVATE BANKING - GLOBAL INVESTMENT MANAGEMENT & SERVICES

Société Générale is authorised and regulated by the French Autorité de Contrôle Prudentiel and Autorité des Marchés Financiers. This material has been prepared solely for information purposes and does not constitute an offer to enter into a contract. Not all products and services offered by Société Générale are available in all jurisdictions. Please contact your local offi ce for any further information. © 2012 Societe Generale Group and its affi liates. © GettyImages - FRED & FARID

HD CIB_BU_200x270_OECD OBSERVER_OCT_GB.indd 1 12/10/12 17:52 OECD.ORG

French President François Hollande meets with heads of international organisations at the OECD ©Julien Daniel/OECD President of France, François Hollande, WTO Director-General Pascal Lamy (centre) and OECD Secretary-General Angel Gurría

The president of the French Republic, of the French Republic has met the leaders During the three hour meeting that François Hollande, met the heads of the five major international economic followed, participants shared their views of five major international economic organisations”. He said he hoped to on the global economic outlook as well organisations at the OECD on 29 October. repeat the event in France, “so every year, as the European and French economies, OECD Secretary-General Angel Gurría members of the government and [himself] focusing on the policies needed to return hosted top officials of the International can have a meeting with the heads of the to growth, promote employment, improve Monetary Fund, the World Bank, the World five international organisations to discuss competitiveness and address trade and Trade Organization and the International the present situation, to see where Europe development challenges. Following their Labour Organisation, all of whom met with is at and also to look at the various policy working sessions, President Hollande the French president and his ministers of actions that France should consider”. and the heads of the international foreign affairs, economy and finance, and The president noted that all participants organisations held a news conference employment. agreed on the seriousness of challenges at the OECD. to be met and the need to strengthen In his initial remarks, the president noted competitiveness as part of efforts to For more on the meeting see: that it was “the first time that a president restore growth and confidence. www.oecd.org/france

48 OECD.ORG

Mexican President- elect Enrique Peña Nieto at the OECD: A common vision

On 18 October, the Mexican President-elect, Enrique Peña Nieto, ended his European tour with a visit to OECD headquarters in Paris. Mr Peña Nieto met with OECD Secretary-General Angel Gurría, conducted a press conference and participated in

a seminar with OECD experts on topics ©Julien Daniel/OECD ranging from the economy to education Enrique Peña Nieto, president-elect of Mexico and environment. Mr Peña Nieto also delivered a keynote address on Mexico’s a lot of points in common with the “I’m certain that in the eyes of the world, challenges and its role in a changing global recommendations formulated by the Mexico is starting a new stage in its landscape. OECD: the need to activate economic history and it will be seen as an example growth, raising productivity, increasing of success in the 21st century”. During his speech Mr Peña Nieto said: investment and creating better conditions “Our vision to transform Mexico has for competitiveness.” He concluded: Visit www.oecd.org/mexico Competitiveness challenge Restoring competitiveness is one of the key challenges to bring European economies back on a path of strong, sustainable and ©Bundesregierung/Guido Bergmann balanced growth, the OECD believes. German Chancellor Angela Merkel and OECD Secretary- Europe could improve its growth General Angel Gurría in Berlin, 30 October 2012 ©OECD/Andrew Wheeler ©OECD/Andrew Ollanta Humala, president of Peru at the OECD prospects by implementing a strategic on 15 November 2012 and comprehensive reform agenda with a Both developments call for strong and broad range of policy reforms to increase decisive policy actions to boost productivity Peru eyes membership productivity, dynamism and employment. in all European countries, and to create mechanisms allowing for a stronger link Peruvian president, Ollanta Humala, visited This is the main message of a report, between productivity gains and wages. A the OECD on 15 November, accompanied by Addressing the Competiveness Challenges in comprehensive reform strategy would also foreign affairs minister, Rafael Roncagliolo Germany and the Euro Area, which OECD include further product and labour market Orbegoso, economics and finance minister, Secretary-General Angel Gurría presented reforms, fostering innovation, service Luis Miguel Castilla Rubio, as well as by the to German Federal Chancellor Angela liberalisation, and investment in skills Peruvian ambassador to France, Cristina Merkel during her annual meeting with and education, which is also key to deal Velita de Laboureix. During the meeting, the leaders of international economic with the social impact of the crisis. The President Humala elaborated on the organisations in Berlin, 30 October. report is designed to support European economic situation of Peru as well as his countries and institutions in their efforts political priority to promote social inclusion Part of the OECD Better Policies Series, to formulate and implement an agenda for and reduce inequalities in his country. the report describes how the euro area inclusive growth and competitiveness in The Peruvian president has expressed his is faced with the double challenge of Europe. country’s interest membership of the OECD. addressing diverging competitiveness For more information, see For more information on this visit and OECD work patterns between its members while www.oecd.org/about/secretary-general/germanyand with Peru see: www.oecd.org/countries/peru redressing it vis-à-vis the rest of world. theeuroareaaddressingthecompetitivenesschallenge.htm

OECD Observer No 293 Q4 2012 49 OECD.ORG

education backgrounds focused on such as damage to the environment the progress achieved in looking for and bio-diversity, pollution, and over- new growth metrics and the way ahead exhaustion of limited natural resources. for monitoring and analysing our These problems have now reached a scale changing world. where they cannot be ignored”.

The OECD’s chief statistician, Martine A statement from the Global Forum Durand, said that new indicators were underlined the need for a strengthened being advanced in a number of areas, link between statistics, knowledge and such as the material conditions of policy, which requires engagement from households, in several quality of life civil society, the business community, domains and in the field of environmental statisticians, academics as well as Joseph Stiglitz accounting. But she added that technical politicians. ©Reuters/Mike Segar ©Reuters/Mike and conceptual challenges remain. As Nobel Prize winning economist Joseph Well-being priority Pointing out that India’s per capita GDP Stiglitz–who has written on the subject A major step forward towards putting is a tenth of the OECD average, Montek for the OECD Observer–said at the forum, the measurement of well-being at the heart Singh Ahluwalia, deputy chairman of “metrics are important not just because of policymaking was taken at the OECD’s India’s Planning Commission, emphasised they tell us how we are doing but because World Forum on Measuring Well-Being for a particular challenge facing developing they serve as guides in policymaking”. Policymaking and Development, a four-day nations: international conference held in New Delhi For more information on the World Forum on Measuring in October. “At India’s income level, ignoring GDP Well-Being for Policymaking and Development, including the concluding statement, visit www.oecd.org/site/ entirely would be impossible. But GDP worldforumindia Experts and policymakers from economic, simply measures goods produced. It does See also: www.oecdbetterlifeindex.org environment, development, health and not measure the negative externalities,

near the coasts and nearly a tenth of the planet’s biggest cities near the sea, it plays Totalled a crucial role in the globalisation of the recall economy and the sustained prosperity of our planet. How sure are you that the item you Governance of international maritime have just bought has zones, innovation in sustainable energy Brindicci/Reuters ©Marcos not been recalled and conservation of fishing stock remain for safety reasons? Deaths and injuries central in a rapidly changing world. worldwide from unsafe products are estimated to cost more than US$1 trillion Also, 80% of all tourism takes place on each year, according to the OECD. the coast, adding to pressures for action. ©Shutterstock/voyager624 ©Shutterstock/voyager624 The maritime sector can also provide new A new portal has been launched to sources of energy. Maritime wind power is give quick and easy access to the latest Video view: The developing rapidly, and could provide up to information on products recalled from the a third of all windpower by 2050. market in Australia, Canada, Europe and blue economy the US. Consumers will be able to check International organisations are boosting on the portal whether the bicycle or other Policymakers building environmentally- their efforts to define the potential of the items they are buying in a store or online oriented “green” growth strategies should “blue economy”. have been taken off shelves in another add a good splash of blue to them too. country. Businesses, such as importers or The ocean covers two-thirds of the earth, Watch “Blue economy” and other short videos, at retailers, will be able to react quickly and and with one in three people already living www.oecd.org/newsroom/photosandvideos pull products as concerns arise. Visit globalrecalls.oecd.org

50 OECD.ORG

Recent speeches by Angel Gurría

Action required: OECD’s message to the Keeping up the reform effort for stronger, International Institute of Finance cleaner and fairer growth in Indonesia 12 October 2012 28 September 2012 Remarks delivered at an International Remarks delivered during the roundtable Institute of Finance, 30th anniversary discussion at the Indonesian Centre for membership meeting, Tokyo, Japan. Strategic and International Studies (CSIS), Jakarta, Indonesia. Deauville Partnership: OECD’s work on economic governance across the Let the Garuda soar: Further steps to MENA region a stronger, cleaner and more inclusive 12 October 2012 Indonesian economy Remarks delivered at the Deauville 27 September 2012

© Osman Orsal/Reuters Partnership meeting of the finance Remarks delivered in Jakarta, Indonesia. For a complete list of speeches ministers, Tokyo, Japan. Italy’s structural reforms: Courageous and statements, including those in OECD, an active partner of the G20 and efforts and more to be done French and other languages, go to B20 in the global fight against corruption 24 September 2012 www.oecd.org/speeches 10 October 2012 Opening remarks delivered at the Remarks delivered at the dinner of the B20 International Conference on Structural Task Force on Improving Transparency and Reforms in Italy, Rome, Italy. Anti-Corruption, Paris, France. The emergence of global value chains: Better data for better analysis and What do they mean for business? Capital flow management and liberalisation: better policies 5 November 2012 The role of international co-operation 19 September 2012 Remarks delivered at the G20 Trade and 9 October 2012 Remarks delivered at the Workshop on Investment Promotion Summit, Mexico City, Remarks delivered at a high-level seminar Global Value Chains, Beijing, People’s Mexico. on the role of international co-operation in Republic of China. capital flow management and liberalisation, Financial regulation and innovation in Paris, France. Jobs for Europe: The employment emerging markets and developing economies policy conference 3 November 2012 Rebuilding confidence: A new agenda 6 September 2012 Remarks delivered in Mexico City, Mexico. for inclusive growth Keynote speech delivered at the Employment 4 October 2012 Policy Conference, Brussels, Belgium. A new agenda for trade Remarks delivered at the OECD High-Level 30 October 2012 Parliamentary Seminar, Paris, France. The need for structural reforms Remarks delivered at the trade policy lunch 2 September 2012 on discussion “Standstill in the Doha Round: Harnessing Africa’s resources for Introductory remarks delivered at the Are bilateral free-trade agreements a way out sustainable and inclusive growth Network of Ideas Business Lunch 2012, of the dead-end?”, Berlin, Germany. 4 October 2012 Bled, Slovenia. Remarks delivered at the 12th International Latin America on the global stage Economic Forum on Africa, Paris, France. 23 October 2012 Remarks delivered at the 2012 Canning It’s all about reform and trust! Conference: Latin America on the Global 3 October 2012 New ambassadors Stage, London, UK. Remarks delivered at the OECD debate at 16 July Hans-Jürgen Heimsoeth took the Parliamentary Assembly of the Council up his duties as new ambassador for Measuring well-being for development of Europe, Strasbourg, France. Germany, replacing Johannes Westerhoff. and policy making 2 October Paul Dühr took up his duties 16 October 2012 Estonia: Greater economic stability and as new ambassador for Luxembourg, Remarks delivered at the 4th OECD World resilience can be achieved by investing in replacing Georges Santer. Forum on Statistics, Knowledge and Policy on the Estonian people “Measuring Well-Being for Development and 1 October 2012 12 November Pavel Rozsypal took up his Policy Making”, New Delhi, India. Opening remarks delivered at the launch duties as new ambassador for the Czech of the Economic Survey of Estonia, Tallinn, Republic, replacing Karel Dyba. Estonia.

OECD Observer No 293 Q4 2012 51 OECD.ORG

Calendar highlights

Please note that many of the OECD meetings mentioned are not open to the public or the media and are listed as a guide only. All meetings are in Paris unless otherwise stated. For a comprehensive list, see the OECD website at www.oecd.org/media/upcoming, which is updated regularly.

OCTOBER 16 Ibero-American summit 2012. 13-14 Reforming EU fiscal governance, 26-27 Global forum on transparency and Cadiz, Spain. conference organised by the European Central Bank and the International exchange of information for tax 18-20 Launch of the Southeast Asian Economic Monetary Fund. Frankfurt, Germany. purposes. Cape Town, South Africa. Outlook 2013. Phnom Penh, Cambodia. In 2013 31-1/11 Global value-chains and competitiveness: 19-20 Forum économie santé, organised by Latin America and Caribbean, conference Les Échos. Paris, France. JANUARY of the Latin America and Caribbean-OECD investment initiative, co-organised with 25-29 Capacity building on strengthening 9-10 OECD Mexico Forum: Public Policies for the government of Costa Rica and the integrity in the public and private sector Inclusive Development, organised by Inter-American Development Bank. of the Middle East and North Africa the OECD, the ECLAC, the Inter-American San José, Costa Rica. (MENA) region, seminar organised in Development Bank and the World Bank. co-operation with the International 15-17 International Water Summit. NOVEMBER Monetary Fund. Kuwait City, Kuwait. Abu Dhabi, United Arab Emirates. 4-5 G20 finance ministers and central bank 27 Launch of the OECD Economic Outlook. governors’ meeting. Mexico City, Mexico. 16-18 Gaidar Forum: Russia & the World: 27-28 European employment forum. Challenges of integration. 7-8 OECD global forum on value added tax, Brussels, Belgium. Moscow, Russia. organised by the Centre for Tax Policy and Administration. 27-7/12 COP 18: United Nations climate change 23-27 World Economic Forum. conference. Doha, Qatar. Davos, Switzerland. 8-10 Les journées de l’économie. Lyon, France. 28-29 Patent statistics for decisionmakers FEBRUARY 9 Ministerial conference of the South 2012: Knowledge assets and economic 11-15 Financial Action Task Force plenary and East Europe investment committee, growth, organised by the OECD and the working group meetings. co-organised by the Regional Cooperation European Patent Office (EPO). Council Secretariat and the government 28 European Competition Forum. DECEMBER of Albania. Tirana, Albania. Brussels, Belgium. 3-7 Sahel and West Africa Week. 12 Launch of the World Energy Outlook MARCH–MAY 2012, organised by the International Ouagadougou, Burkina Faso. 24-26/3 France BioVision: The World Energy Agency. 4-5 High level meeting of the OECD Life Sciences Forum. Development Aid Committee. London, 14-16 World pension summit. Amsterdam, th the Netherlands. United Kingdom. 26-27/3 9 annual meeting of the OECD LEED Forum on Partnerships and Local 6-7 Debt, growth and macroeconomic 14-16 Tourism Statistics, global forum Governance. Dublin–Kilkenny, Ireland. co-organised by the OECD Tourism policies, conference organised by Committee, Statistics Iceland, the Icelandic the European Central Bank. Frankfurt, 8-9/4 International Labour Organization’s Ministry of Industry, Energy and Tourism, Germany. European Regional meeting. Oslo, Norway. and the Statistical Office of the European 9-12 European nuclear conference, Union (EUROSTAT). Reykjavík, Iceland. co-organised by the European Nuclear 22-24/5 International Transport Forum’s 15 Le Secteur Public, conference organised Society (ENS), the OECD Nuclear Energy 2013 Summit. Leipzig, Germany. Agency, the International Atomic Energy by Les Échos. Paris, France. 27-31/5 OECD annual Forum and Council Agency and the Nuclear Institute. Ministerial Meetings. Manchester, United Kingdom.

52 BOOKS OECD iLibrary

A calm look at social unrest

In a globalised unrest evolves in a globalised setting, tragedy in Louisiana’s Gulf Coast. While world, social and if it differs from past experiences. the category three storm was not the unrest occurring Will social unrest manifest in the cyber strongest the region ever experienced, the far away can have world? How will social unrest affect global escalation of events during and following transnational interdependencies? By developing an Katrina turned it into the most destructive. ramifications, with analytical framework of social unrest, Media coverage focused on the crimes that effects nearer to the report seeks to provide feasible policy arose. Nevertheless, most of the blame was home. This has options to help governments address social placed on the public authorities for their been evident unrest itself, and manage its possible failure to secure law and order and address in recent years consequences. In working within the the problems in a more even-handed with movements paradigm that social unrest is more of way. Katrina highlights the many factors such as Occupy and Indignados, and the a process of escalation than a finite state, that need to be taken into account when Arab Spring. Unrest could also be the the report identifies the drivers, or casual evaluating the risks of social unrest and consequence of a terrorist attack, but even roots, and triggers–events that lead to underlines the difficulties in addressing the threat of one can lead to widespread social unrest–in four case studies: the them properly. By approaching unrest panic. The upshot can be disorder and 2010 Greek financial crisis, the H1N1 within a framework of risks and potential economic turmoil. outbreak in 2009, cyber-related risks and consequences, societies could be better Hurricane Katrina. equipped to handle the eventualities of The OECD Review of Risk Management social unrest, the report suggests. Policies: Social Unrest is one of a series Take the aftermath of Hurricane Katrina, presented by the OECD project on Future in which poor planning, widespread panic ISBN 9789264173453 Global Shocks. The report asks how social and uneven response led to chaos and

Still booming

The Internet is This time-saving, and potentially life-saving Internet Economy Outlook 2012 also looks much more than a development is important for enhancing at the issue of information security multi-billion dollar healthcare delivery, especially in remote and maintaining the reliability of the industry. The areas with limited access to medical systems on which we all depend. Wireless world’s economy facilities. In Australia, telemedicine is connections are a key source of Internet now depends a critical component of the country’s expansion: by December 2011, the on this global strategic plans for delivering healthcare to estimated number of wireless broadband “cloud”, which was the indigenous population. Canada, too, connections in OECD countries was once little more uses telehealth systems to service 21% of more than double that of fixed broadband than a means its population who live in rural areas. subscriptions. The number of mobile of connecting phone subscriptions has tripled in non- different computers over a phone network. E-health brings benefits for all countries; OECD countries, too; in fact, many people Today, the digital age has vast new potential for instance, the report encourages in poor countries will find it easier to to serve as a force of progress in the governments everywhere to adopt access the Internet using a mobile device global economy, but better, smarter public electronic health records for use by doctors than to access clean water. But by bringing policies will be needed for that potential to and hospitals. But the continuing success in knowledge and connecting the right become reality. of these practices depends on government people, the Internet can indirectly help cooperation and action. Many factors have improve water quality too. The issue of healthcare, in which slowed the expansion of telehealth, such as innovation meets governance, is one of regulatory barriers, limited reimbursement ISBN 9789264086456 the topics explored in the OECD’s Internet and failure to inform the public about Economy Outlook 2012. Take telehealth, the benefits of telehealth technologies which works by transmitting voice, data, and services. images and information via the Internet.

OECD Observer No 293 Q4 2012 53 BOOKS OECD iLibrary

All publications available at www.oecd.org/bookshop Current bestsellers and www.OECD-iLibrary.org

Education at a OECD Agricultural Policy Glance 2012: Employment Monitoring and OECD Indicators Outlook 2012 Evaluation 2012: This book This 30th edition OECD Countries provides data of the OECD This edition of on the structure, Employment OECD’s annual finances, and Outlook examines on support to performance of the labour market agriculture shows education systems performance of that after an in OECD member countries as well as in OECD countries as well as the prospects increase in 2009, producer support in selected non-member countries. in the short term. OECD area declined in 2010 and remained ISBN 978-92-64-17715-4, September 2012, 568 pages ISBN 978-92-64-16668-4, August 2012, 260 pages stable in 2011. €75 $105 £67 ¥9 700 €80 $112 £72 ¥10 400 ISBN 978-92-64-17352-1, September 2012, 288 pages €54 $75 £48 ¥7 000 OECD Internet Economy Outlook Better Skills, OECD Science, 2012 Better Jobs, Technology and Supported by Better Lives: Industry Outlook time series data, A Strategic 2012 this publication Approach to Skills Based on the latest provides an Policies information and overview of trends indicators in The OECD Skills and highlights science and Strategy provides how the Internet sector has proven to be innovation, this a strategic resilient during the recent economic crisis. book reviews key trends in STI policies framework to help countries understand It then examines the drivers and impacts and performance in OECD countries and more about how to invest in skills in a of Internet use and deployment, as well major emerging economies, and across a way that will transform lives and drive as emerging technologies. number of thematic areas. economies. ISBN 978-92-64-08645-6, October 2012, 302 pages ISBN 978-92-64-17032-2, September 2012, 280 pages ISBN 978-92-64-17729-1, September 2012, 120 pages €90 $126 £81 ¥11 700 €60 $84 £54 ¥7 800 €39 $54 £35 ¥5 000 Model Tax OECD Insights OECD-FAO Convention on From Aid to Agricultural Income and on Development: Outlook 2012 Capital 2010: The Global Fight Full Version This report against Poverty provides world This full version market trends for This book explores contains the full biofuels, cereals, the multi-faceted text of the Model oilseeds, sugar, world of aid and Tax Convention meats, fish and development on Income and on Capital as it read on dairy products over the 2012-2021 period. co-operation–a range of global, and 22 July 2010, including the Articles, sometimes contested, efforts aimed at Commentaries, non-member economies ISBN 978-92-64-17302-6, July 2012, 282 pages reducing the impact of poverty. positions, the Recommendation of the €60 $84 £54 ¥7 800 ISBN 978-92-64-11152-3, August 2012, 188 pages OECD Council, the historical notes (now €15 $19 £10 ¥2 000 expanded to go back to 1963), the detailed list of conventions between OECD member countries and the background reports. ISBN 978-92-64-17517-4, August 2012, 2000 pages €325 $455 £292 ¥42 200

54 BOOKS OECD iLibrary

New publications

economy DEVELOPMENT Strong Performers and Successful Reformers in Education OECD Economic Surveys: Estonia 2012 Conflict and Fragility Delivering School Transparency ISBN 978-92-64-12830-9, October 2012, 122 pages Improving International Support to in Australia: National Reporting €61 $86 £54 ¥7 200 Peace Processes: The Missing Piece through My School ISBN 978-92-64-17983-7, September 2012, 112 pages ISBN 978-92-64-17563-1, August 2012, 82 pages OECD Economic €24 $33 £21 ¥3 100 €30 $42 £27 ¥3 900 Surveys: Indonesia 2012 Better Aid Strong Performers and Successful ISBN 978-92-64- Aid Effectiveness in the Health Sector: Reformers in Education 12820-0, Progress and Lessons Guidance from PISA for October 2012, 105 pages ISBN 978-92-64-13068-5, September 2012, 92 pages the Canary Islands, Spain €61 $86 £54 ¥7 200 €27 $37 £24 ¥3 500 ISBN 978-92-64-17417-7, August 2012, 96 pages €30 $42 £27 ¥3 900 Capital Markets in the Dominican Republic: Tapping the Potential PISA OECD Economic Surveys: Portugal 2012 for Development Untapped Skills: Realising the ISBN 978-92-64-12798-2, August 2012, 116 pages ISBN 978-92-64-17761-1, September 2012, 104 pages Potential of Immigrant Students €61 $86 £54 ¥7 200 €24 $33 £21 ¥3 100 ISBN 978-92-64-17229-6, August 2012, 204 pages €60 $84 £54 ¥7 800 OECD Economic Surveys: Turkey 2012 EDUCATION ISBN 978-92-64-12796-8, August 2012, 108 pages Teaching Practices and Pedagogical €61 $86 £54 ¥7 200 Education at a Innovations: Evidence from TALIS Glance 2012: ISBN 978-92-64-12328-1, September 2012, 172 pages National Accounts of OECD Countries, Highlights €24 $33 £21 ¥3 100 Volume 2012 Issue 2: Detailed Tables ISBN 978-92-64- ISBN 978-92-64-17949-3, August 2012, 320 pages 17956-1, OECD Reviews of Evaluation and €75 $105 £67 ¥9 700 September 2012, Assessment in Education: 91 pages Luxembourg 2012 AGRICULTURE €28 $39 £25 ¥3 600 ISBN 978-92-64-11679-5, October 2012, 160 pages €30 $42 £27 ¥3 900 Livestock Diseases: Connected Minds: Prevention, SET Education at a Glance 2012: Technology and Control and OECD Indicators and Highlights Today’s Learners Compensation ISBN 978-92-64-17958-5, September 2012, ISBN 978-92-64- Schemes 2 volumes 07522-1, August 2012, ISBN 978-92-64- €80 $112 £72 ¥10 400 172 pages 17875-5, August 2012, €24 $33 £21 ¥3 100 204 pages Strengthening Integrity and Fighting €60 $84 £54 ¥7 800 Corruption in Education: Serbia ISBN 978-92-64-17963-9, October 2012, 138 pages OECD Review of Agricultural €26 $36 £23 ¥3 300 Policies: Indonesia 2012 EMPLOYMENT ISBN 978-92-64-17900-4, October 2012, 292 pages Reviews of National Policies for Education Higher Education in the €50 $70 £45 ¥6 500 Closing the Gender Gap: Act Now Dominican Republic 2012 ISBN 978-92-64-17936-3, October 2012, 296 pages ISBN 978-92-64-17700-0, August 2012, 180 pages €80 $112 £72 ¥10 400 €54 $75 £48 ¥7 900

OECD Observer No 293 Q4 2012 55 BOOKS OECD iLibrary

Free Movement of Workers and ENVIRONMENT Stocktaking of Business Integrity and Labour Market Adjustment: Recent Anti-Bribery Legislation, Policies and Experiences from OECD Countries and OECD Studies on Water Practices in Twenty African Countries A Framework for Financing Water the European Union ISBN 978-92-64-16952-4, October 2012, 170 pages Resources Management ISBN 978-92-64-17717-8, July 2012, 300 pages €45 $63 £40 ¥5 800 ISBN 978-92-64-17981-3, September 2012, 96 pages €60 $84 £54 ¥7 800 €24 $33 £21 ¥3 100 GOVERNANCE ENERGY Evaluation of Agri-Environmental Competitive Neutrality: Maintaining Medium-Term Policies: Selected Methodological a Level Playing Field between Public Renewable Issues and Case Studies and Private Business Energy Market ISBN 978-92-64-17932-5, September 2012, 256 pages ISBN 978-92-64-17894-6, September 2012, 120 pages €69 $96 £62 ¥8 900 Report 2012 €30 $42 £27 ¥3 900 Market Trends OECD Studies on Environmental Innovation Value for Money in Government: and Projections Energy and Climate Policy: Bending Australia 2012 to 2017 the Technological Trajectory ISBN 978-92-64-17879-3, July 2012, 152 pages ISBN 978-92-64- ISBN 978-92-64-17456-6, October 2012, 150 pages €30 $42 £27 ¥3 900 17799-4, August 2012, €48 $67 £43 ¥6 200 100 pages OECD Public Governance Reviews €100 $140 £90 ¥13 000 FINANCE AND INVESTMENT Slovenia: Towards a Strategic and Efficient State Coal Information 2012 OECD Banking Statistics: Financial ISBN 978-92-64-17325-5, July 2012, 220 pages ISBN 978-92-64-17470-2, September 2012, 566 pages Statements of Banks 2012 €54 $75 £48 ¥7 000 €165 $231 £148 ¥21 400 ISBN 978-92-64-17978-3, October 2012, 320 pages €90 $126 £81 ¥11 700 OECD Public Governance Reviews: Electricity Information 2012 France: An international perspective on ISBN 978-92-64-17468-9, September 2012, 760 pages Corporate Governance, Value Creation the General Review of Public Policies €150 $210 £135 ¥19 500 and Growth: The Bridge between ISBN 978-92-64-16756-8, August 2012, 216 pages Finance and Enterprise €70 $98 £63 ¥9 100 Natural Gas Information 2012 ISBN 978-92-64-17953-0, September 2012, 88 pages ISBN 978-92-64-17473-3, September 2012, 600 pages €24 $33 £21 ¥3 100 €165 $231 £148 ¥21 400 INDUSTRY AND SERVICES Board Member Renewables Information 2012 Women in Business: Policies to Nomination and ISBN 978-92-64-17388-0, September 2012, 460 pages Support Women’s Entrepreneurship €110 $154 £99 ¥14 300 Election Development in the MENA Region ISBN 978-92-64- ISBN 978-92-64-17905-9, September 2012, 134 pages Energy Balances of Non-OECD 17934-9, October 2012, €24 $33 £21 ¥3 100 105 pages Countries 2012 €30 $42 £27 ISBN 978-92-64-17466-5, September 2012, 554 pages SME Policy Index: Eastern ¥3 900 €120 $168 £108 ¥15 600 Partner Countries 2012 ISBN 978-92-64-17883-0, October 2012, 250 pages Energy Statistics of Non-OECD €50 $70 £45 ¥6 500 Countries 2012 OECD Reviews of Risk Management Policies NUCLEAR ENERGY ISBN 978-92-64-17459-7, September 2012, 750 pages Systemic Financial Risk €120 $168 £108 ¥15 600 ISBN 978-92-64-11272-8, July 2012, 81 pages Nuclear Energy Data 2012 €25 $35 £22 ¥3 200 Energy Statistics of OECD ISBN 978-92-64-17785-7, October 2012, 140 pages €42 $58 £37 ¥5 400 Countries 2012 ISBN 978-92-64-08876-4, August 2012, 420 pages €120 $168 £108 ¥15 600

56 BOOKS OECD iLibrary

SCIENCE AND TECHNOLOGY • The Republic of Liberia 2012: Phase 1: Legal OECD Territorial Reviews: and Regulatory Framework Skåne, Sweden 2012 OECD Reviews of Regional Innovation ISBN 978-92-64-17813-7, July 2012, 80 pages ISBN 978-92-64-17750-5, July 2012, 296 pages Central and Southern Denmark 2012 • Montserrat 2012: Phase 1: Legal and €60 $84 £54 ¥7 800 ISBN 978-92-64-17873-1, September 2012, 236 pages Regulatory Framework €45 $63 £40 ¥5 800 ISBN 978-92-64-17819-9, July 2012, 72 pages OECD Territorial Reviews: The Chicago Tri-State Metropolitan Area, SOCIAL ISSUES, MIGRATION • Saint Lucia 2012: Phase 1: Legal and United States 2012 AND HEALTH Regulatory Framework ISBN 978-92-64-17028-5, September 2012, 320 pages ISBN 978-92-64-17821-2, July 2012, 84 pages Connecting with Emigrants: €72 $100 £64 ¥9 300 • United Arab Emirates 2012: Phase 1: Legal A Global Profile of Diasporas and Regulatory Framework FORTHCOMING ISBN 978-92-64-17793-2, October 2012, 388 pages ISBN 978-92-64-17823-6, July 2012, 116 pages €96 $134 £86 ¥12 400 • Development Co-operation Report 2012 TRADE OECD Reviews of Risk Management Policies • OECD Integrity Review of Brazil: Managing Risks for a Cleaner Public Service Social Unrest OECD Trade Policy ISBN 978-92-64-17345-3, August 2012, 104 pages Studies • OECD Review of Agricultural Policies: €30 $42 £27 ¥3 900 Illegal Trade in Indonesia 2012 Environmentally TAXATION • Sustainable Materials Management: Sensitive Goods Making Better Use of Resources Taxing Wages 2011 ISBN 978-92-64- 17422-1, October 2012, • Tax and Development: Aid Modalities for ISBN 978-92-64-17327-9, August 2012, 579 pages Strengthening Tax Systems €150 $210 £135 ¥19 500 112 pages €33 $46 £29 ¥4 200 • Water Governance in Latin America and the Global Forum on Caribbean: A Multi-level Approach Transparency and • Waiting Time Policies in the Health Sector: Exchange TRANSPORT What Works of Information • World Energy Outlook 2012 for Tax Purposes Trends in the Transport Sector 2012 Peer Reviews ISBN 978-92-82-10371-5, September 2012, 80 pages All priced at €36 $50 €28 $39 £25 ¥3 600 £32 ¥4 600 Pedestrian Safety, All publications listed on these pages Urban Space and are available at: Health www.oecd.org/bookshop and • People’s Republic of China 2012: Combined: ISBN 978-92-82- www.oecdilibrary.org Phase 1 + Phase 2 10364-7, ISBN 978-92-64-17825-0, July 2012, 124 pages September 2012, • Cook Islands 2012: Phase 1: Legal and 116 pages A list of OECD publications distributors Regulatory Framework €30 $42 £27 ¥3 900 in various countries is available at: ISBN 978-92-64-17811-3, July 2012, 80 pages www.oecd.org/publishing/ • Greece 2012: Combined: Phase 1 + Phase 2 distributors ISBN 978-92-64-17827-4, July 2012, 120 pages URBAN, RURAL AND REGIONAL • Grenada 2012: Phase 1: Legal and Regulatory DEVELOPMENT A list of institutions subscribing Framework ISBN 978-92-64-17817-5, July 2012, 80 pages OECD Green Growth Studies to the OECD iLibrary is available at: Linking Renewable Energy to www.oecd.org/publishing/ • Lebanon 2012: Phase 1: Legal and Regulatory Framework Rural Development oecdilibrarysubscribers ISBN 978-92-64-18042-0, October 2012, 347 pages ISBN 978-92-64-17815-1, July 2012, 80 pages €90 $126 £81 ¥11 700

OECD Observer No 293 Q4 2012 57 BOOKS OECD iLibrary

Vive la réforme

People looking rationalise expenditure and modernise administrative reorganisation by merging, for models of management of the central government’s transferring or changing the missions of public governance human resources. Aimed principally at government departments, for instance. reform may not central government, the approach involves The programme has also helped bolster immediately a series of structural reforms such as interconnectedness and information think of France, mergers of support services, reforms to exchange among ministries. but perhaps they internal governance and management of should think the civil service, and improvements to the Nevertheless, room for improvement again. In July quality of services delivered, particularly remains. Efforts to pool support functions, 2007, France through e-government. Reducing for instance, have not gone far enough, launched a reform government spending is also a key focus. and the publication provides a number programme called “General Review of of recommendations for further action. Public Policies” (Révision Générale des The publication analyses the programme’s Politiques Publiques, RGPP). Implemented results so far by comparing them to the The case studies drawn from the French at central government level, it adopts a review’s original objectives. Drawing experience could prove useful to all novel approach that could prove a useful lessons on budget savings and attempts OECD countries looking to improve model for other OECD countries. to foment a culture of innovation and governance and the performance of public improve their delivery of services, the administrations. Likewise, they could assist France: An International Perspective on the report finds that the French general local authorities keen to innovate and General Review of Public Policies provides public policy review has enhanced central provide better services at a lower cost. an in-depth look at a programme that government organisation and operations. seeks to improve public services for users, Improvements have been achieved in ISBN 139789264167568

OECD OBSERVER ORDER FORM – SUBSCRIBE TODAY!

Yes, sign me up for 4 issues and € 75 Yes, sign me up for 8 issues € 104 OECD Yearbook US$ 99 OECD Yearbooks US$ 142 my annual . £ 59 plus 2 annual £ 84 ¥ 9 500 and save 30%! ¥ 13 900

You can order either online at www.oecd.org/bookshop or by mail at one of the addresses below

Name Organisation

Telephone Fax Position held

Address E-mail

Date Postcode, City and Country

Subscription will start with the next available issue. You will receive the English language edition Signature unless you select the French - tick here

For customers in the US Turpin Distribution, The Bleachery, 143 West Street, New Milford, Connecticut 06776 USA Payment details Tel: (1) 800 456 6323 Fax: (1) 860 350 0039 Email: [email protected] Cheque/money order enclosed (payable to “OECD”) Please charge my VISA/MasterCard/American Express For customers in the rest of the world Turpin Distribution Ltd., Stratton Business Park, Pegasus Drive, Biggleswade, TOTAL amount due Bedfordshire SG18 8QB, UK Tel: (44) 1767 604 960 Fax: (44) 1767 601 640 E-mail: [email protected] Card number Expiry date

58 BETTER POLICIES FOR BETTER LIVES OECD Model Tax Convention on Income and Capital

Browse and order at www.oecd.org/bookshop New approaches are urgently needed

Join us and take part in the debate OECD WEEK 2013 Paris, 28-30 May www.oecd.org/forum

Contact us: [email protected] DATABANK

Emerging innovators Research and co-operation Number of scientific articles and co-authorships across countries, 1998 and 2009 Making strides in scientific innovation is no longer an initiative of just a few select high-income countries. Research and 1998 2009 BEL SWE BEL SWE innovation have become increasingly POL FRA POL CHE FRA CHE TUR TUR NLD democratised; indeed, Asia’s emerging NLD ITA ITA RUS RUS economies are now gaining prominence as DEU DEU

world hubs of scientific research. While JPN ESP JPN ESP the United States remains at the top in GBR GBR terms of the volume of scientific KOR USA KOR USA publications produced and collaborations CAN CAN

made, these countries are eager to develop CHN AUS CHN AUS BRA BRA their own innovation capabilities, and IND IND strengthen their research and academic partnerships. Source: OECD Science, Technology and Industry Scoreboard 2011 http://dx.doi.org/10.1787/888932689750

Take China, which lagged in the field of evidenced by a significant increase in the As scientific disciplines become more scientific research only ten years ago. number of co-authorships of scientific specialised, researchers in individual Today it has surpassed France and publications among countries, especially countries look to scale up by working Germany, grabbing the number two spot in between China and the United States, and with researchers in similar fields the number of scientific publications Japan and Canada. Korea has also boosted around the world. written in co-operation with researchers its R&D funding in the past decade, and from partner countries. This push towards now publishes more scientific research See www.oecd.org/sti innovation has been accompanied by a than countries such as Sweden, Russia jump in the globalisation of research, as and Turkey.

Share of foreign students Study abroad Destination of foreign students in tertiary education, 2000 and 2010

More students are looking beyond Market share (%) OECD countries 2000 2010 Other G20 and non-OECD countries 2000 2010 25 their borders to give their education a competitive edge. Despite shrinking 20 support for scholarships and tightening travel budgets, 4.1 million students 15

pursued their formal tertiary education 10 abroad in 2010. According to Unesco, there were 177 million students enrolled 5

in tertiary institutions worldwide that year, 0 US an increase of 77 million students since UK Italy Italy Japan Spain China Korea France Austria Canada Belgium 2000. The US suffered a marked drop in Sweden Australia Germany Other G20 Switzerland Other OECD Other OECD South Africa South Netherlands Netherlands

the share of foreign students it received, Zealand New though in absolute terms, the number and non-OECD Source: OECD Education at a Glance 2012 Russian Federation http://dx.doi.org/10.1787/888932667349 of students increased from 475,000 in 2000 to 685,000 in 2010. Young scholars choices for foreign students: among transformed in recent years to become a appear to be flocking mostly to English- most EU contries such as Austria, Italy more popular study abroad destination than speaking countries. Australia, New Zealand and Spain, international students from Sweden or the Netherlands. Meanwhile, and the UK have the highest percentage other EU countries are treated as domestic Korea joins China and India in boasting of international students among their students with respect to tuition fee charges, the largest numbers of students studying tertiary students, and have seen noticeable which are relatively low in these countries. abroad. boosts in their popularity as educational Korea, where most international students destinations in the past decade. Tuition pay tuition fees that are somewhat lower See www.oecd.org/education policies also play a large role in destination than those paid by domestic students, has

OECD Observer No 293 Q4 2012 61 DATABANK

% change from: level: previous previous current same period period year period last year Australia Gross domestic product Q2-2012 0.6 3.7 Current balance Q2-2012 -11.9 -7.7 Industrial production Q2-2012 -1.1 0.5 Unemployment rate Q3-2012 5.3 5.2 Consumer price index Q3-2012 1.4 2.0 Interest rate Q3-2012 3.6 4.9 Austria Gross domestic product Q2-2012 0.1 0.8 Current balance Q2-2012 2.5 1.3 Industrial production Q2-2012 2.2 2.1 Unemployment rate Q3-2012 4.5 3.9 Consumer price index Q3-2012 0.2 2.3 Interest rate Q3-2012 0.4 1.6 Belgium Gross domestic product Q3-2012 0.0 -0.3 Current balance Q2-2012 -1.6 -2.1 Industrial production Q2-2012 -3.3 -6.2 Unemployment rate Q3-2012 7.4 7.3 Consumer price index Q3-2012 0.4 2.6 Interest rate Q3-2012 0.4 1.6 Canada Gross domestic product Q2-2012 0.5 2.9 Current balance Q2-2012 -15.9 -16.5 Industrial production Q2-2012 0.7 2.3 Unemployment rate Q3-2012 7.3 7.3 Consumer price index Q3-2012 -0.2 1.2 Interest rate Q3-2012 1.2 1.2 Chile Gross domestic product Q2-2012 1.7 5.5 Current balance Q2-2012 -3.1 -0.3 Industrial production Q3-2012 -2.1 4.3 Unemployment rate Q3-2012 6.2 7.1 Consumer price index Q3-2012 0.2 2.6 Interest rate Q2-2012 5.1 5.3 Czech Gross domestic product Q2-2012 -0.2 -1.0 Current balance Q2-2012 0.1 -2.1 Republic Industrial production Q2-2012 -2.9 -1.5 Unemployment rate Q3-2012 6.8 6.6 Consumer price index Q3-2012 0.0 3.3 Interest rate Q3-2012 1.0 1.2 Denmark Gross domestic product Q2-2012 -0.4 -0.6 Current balance Q2-2012 5.8 4.3 Industrial production Q2-2012 -0.3 -4.3 Unemployment rate Q3-2012 8.2 7.5 Consumer price index Q3-2012 0.2 2.5 Interest rate Q3-2012 -0.1 1.2 Estonia Gross domestic product Q2-2012 0.5 2.7 Current balance Q2-2012 -0.1 0.0 Industrial production Q3-2012 2.8 -0.9 Unemployment rate Q2-2012 10.0 13.0 Consumer price index Q3-2012 0.8 3.7 Interest rate Q3-2012 0.4 1.6 Finland Gross domestic product Q2-2012 -1.1 0.1 Current balance Q2-2012 0.3 -1.0 Industrial production Q2-2012 1.4 -1.2 Unemployment rate Q3-2012 7.8 7.7 Consumer price index Q3-2012 0.1 2.8 Interest rate Q3-2012 0.4 1.6 France Gross domestic product Q2-2012 0.0 0.3 Current balance Q2-2012 -16.6 -15.7 Industrial production Q2-2012 -0.3 -1.9 Unemployment rate Q3-2012 10.7 9.6 Consumer price index Q3-2012 -0.1 2.0 Interest rate Q3-2012 0.4 1.6 Germany Gross domestic product Q2-2012 0.3 1.0 Current balance Q2-2012 53.9 44.5 Industrial production Q2-2012 -0.2 -0.5 Unemployment rate Q3-2012 5.4 5.8 Consumer price index Q3-2012 0.5 1.9 Interest rate Q3-2012 0.4 1.6 Greece Gross domestic product Q1-2011 0.2 -5.5 Current balance Q2-2012 -2.8 -7.6 Industrial production Q2-2012 1.1 -1.6 Unemployment rate Q2-2012 23.9 16.7 Consumer price index Q3-2012 -1.5 1.3 Interest rate Q3-2012 0.4 1.6 Hungary Gross domestic product Q2-2012 -0.2 -1.1 Current balance Q2-2012 0.5 0.4 Industrial production Q2-2012 -0.4 0.0 Unemployment rate Q2-2012 11.0 10.9 Consumer price index Q3-2012 0.1 6.1 Interest rate Q3-2012 7.9 6.7 Iceland Gross domestic product Q2-2012 -6.5 1.4 Current balance Q2-2012 -0.2 -0.1 Industrial production Q2-2012 -6.4 4.0 Unemployment rate Q3-2012 6.3 7.0 Consumer price index Q3-2012 -0.2 4.3 Interest rate Q3-2012 5.8 4.3 Ireland Gross domestic product Q2-2012 0.0 -0.5 Current balance Q2-2012 4.0 0.5 Industrial production Q3-2012 -4.5 -3.1 Unemployment rate Q3-2012 15.0 14.6 Consumer price index Q3-2012 0.1 1.7 Interest rate Q3-2012 0.4 1.6 Israel Gross domestic product Q2-2012 0.8 3.2 Current balance Q2-2012 -0.1 0.2 Industrial production Q2-2012 2.7 4.1 Unemployment rate Q3-2012 6.7 5.6 Consumer price index Q3-2012 0.6 1.8 Interest rate Q3-2012 2.1 3.0 Italy Gross domestic product Q2-2012 -0.8 -2.6 Current balance Q2-2012 -3.5 -20.0 Industrial production Q2-2012 -1.6 -7.5 Unemployment rate Q3-2012 10.7 8.5 Consumer price index Q3-2012 0.5 3.2 Interest rate Q3-2012 0.4 1.6 Japan Gross domestic product Q3-2012 -0.9 0.2 Current balance Q2-2012 18.9 23.1 Industrial production Q3-2012 -4.1 -4.4 Unemployment rate Q3-2012 4.2 4.4 Consumer price index Q3-2012 -0.6 -0.4 Interest rate Q3-2012 0.3 0.3 Korea Gross domestic product Q3-2012 0.2 1.6 Current balance Q2-2012 8.4 3.3 Industrial production Q3-2012 -2.1 -0.2 Unemployment rate Q3-2012 3.1 3.2 Consumer price index Q3-2012 0.3 1.6 Interest rate Q3-2012 3.2 3.6 Luxembourg Gross domestic product Q2-2012 0.4 0.8 Current balance Q2-2012 0.9 1.0 Industrial production Q2-2012 -2.8 -5.5 Unemployment rate Q3-2012 5.2 5.0 Consumer price index Q3-2012 0.1 2.7 Interest rate Q3-2012 0.4 1.6 Mexico Gross domestic product Q2-2012 0.9 4.1 Current balance Q2-2012 -1.1 -2.5 Industrial production Q2-2012 1.0 .. Unemployment rate Q3-2012 4.8 5.3 Consumer price index Q3-2012 1.1 4.6 Interest rate Q3-2012 4.8 4.8

62 DATABANK

% change from: level: previous previous current same period period year period last year Netherlands Gross domestic product Q2-2012 0.2 -0.5 Current balance Q2-2012 15.7 19.7 Industrial production Q2-2012 0.3 1.3 Unemployment rate Q3-2012 5.3 4.4 Consumer price index Q3-2012 0.5 2.5 Interest rate Q3-2012 0.4 1.6 New Zealand Gross domestic product Q2-2012 0.3 1.9 Current balance Q2-2012 -2.3 -1.5 Industrial production Q2-2012 -0.1 1.7 Unemployment rate Q3-2012 7.3 6.6 Consumer price index Q3-2012 0.3 0.8 Interest rate Q3-2012 2.7 2.8 Norway Gross domestic product Q2-2012 1.2 4.8 Current balance Q2-2012 15.9 18.6 Industrial production Q2-2012 3.2 9.3 Unemployment rate Q2-2012 3.0 3.3 Consumer price index Q3-2012 -0.7 0.4 Interest rate Q3-2012 2.1 3.0 Poland Gross domestic product Q2-2012 0.4 2.5 Current balance Q2-2012 -3.2 -6.3 Industrial production Q3-2012 -0.1 1.5 Unemployment rate Q3-2012 10.1 9.7 Consumer price index Q3-2012 -0.5 3.7 Interest rate Q3-2012 5.0 4.7 Portugal Gross domestic product Q2-2012 -1.2 -3.3 Current balance Q2-2012 -0.7 -5.4 Industrial production Q3-2012 2.3 -3.8 Unemployment rate Q3-2012 15.7 12.8 Consumer price index Q3-2012 -0.2 2.9 Interest rate Q3-2012 0.4 1.6 Slovak Gross domestic product Q2-2012 0.7 3.0 Current balance Q2-2012 0.6 -0.6 Republic Industrial production Q2-2012 5.7 12.0 Unemployment rate Q3-2012 14.0 13.5 Consumer price index Q3-2012 0.3 3.6 Interest rate Q3-2012 0.4 1.6 Slovenia Gross domestic product Q2-2012 -1.0 -2.2 Current balance Q2-2012 1.8 1.7 Industrial production Q2-2012 1.0 0.7 Unemployment rate Q3-2012 8.4 8.1 Consumer price index Q3-2012 -0.4 2.9 Interest rate Q3-2012 0.4 1.6 Spain Gross domestic product Q3-2012 -0.3 -1.6 Current balance Q2-2012 -6.0 -12.1 Industrial production Q2-2012 -1.5 -6.6 Unemployment rate Q3-2012 25.5 22.0 Consumer price index Q3-2012 0.3 2.8 Interest rate Q3-2012 0.4 1.6 Sweden Gross domestic product Q2-2012 0.7 1.3 Current balance Q2-2012 7.7 8.4 Industrial production Q2-2012 1.6 0.1 Unemployment rate Q3-2012 7.7 7.3 Consumer price index Q3-2012 -0.4 0.6 Interest rate Q3-2012 1.1 1.7 Switzerland Gross domestic product Q2-2012 -0.1 0.6 Current balance Q2-2012 20.7 16.7 Industrial production Q4-2011 1.0 -1.4 Unemployment rate Q2-2012 3.7 3.6 Consumer price index Q3-2012 -0.6 -0.5 Interest rate Q3-2012 0.1 0.1 Turkey Gross domestic product Q2-2012 1.8 3.2 Current balance Q2-2012 -12.1 -20.8 Industrial production Q2-2012 -2.5 3.4 Unemployment rate Q2-2012 7.9 9.1 Consumer price index Q3-2012 -0.2 9.0 Interest rate .. .. United Gross domestic product Q3-2012 1.0 -0.1 Current balance Q2-2012 -32.8 -4.9 Kingdom Industrial production Q3-2012 0.9 -1.4 Unemployment rate Q2-2012 7.9 7.9 Consumer price index Q3-2012 0.3 2.4 Interest rate Q3-2012 0.7 0.9 United Gross domestic product Q3-2012 0.5 2.3 Current balance Q2-2012 -117.4 -119.1 States Industrial production Q3-2012 -0.1 3.2 Unemployment rate Q3-2012 8.1 9.1 Consumer price index Q3-2012 0.2 1.7 Interest rate Q3-2012 0.3 0.3 Euro area Gross domestic product Q2-2012 -0.2 -0.4 Current balance Q2-2012 36.5 -8.7 Industrial production Q2-2012 -0.4 -2.2 Unemployment rate Q3-2012 11.5 10.2 Consumer price index Q3-2012 .. 2.5 Interest rate Q3-2012 0.4 1.6

Non-members 2Brazil Gross domestic product Q2-2012 0.4 0.5 Current balance Q2-2012 -14.4 -12.4 Industrial production Q3-2012 0.8 -2.4 Unemployment rate .. .. Consumer price index Q3-2012 1.1 5.2 Interest rate .. .. 2China Gross domestic product .. .. Current balance Q3-2011 53.4 101.7 Industrial production .. .. Unemployment rate .. .. Consumer price index Q3-2012 0.1 1.9 Interest rate Q3-2012 3.7 5.6 2India Gross domestic product Q2-2012 0.8 4.2 Current balance Q2-2011 -14.2 -12.5 Industrial production Q2-2012 -1.4 -0.2 Unemployment rate .. .. Consumer price index Q3-2012 3.6 9.8 Interest rate .. .. 2Indonesia Gross domestic product Q3-2012 1.4 6.2 Current balance Q4-2011 -2.3 0.8 Industrial production .. .. Unemployment rate .. .. Consumer price index Q3-2012 1.8 4.5 Interest rate Q3-2012 5.7 6.9 1Russian Gross domestic product Q2-2012 0.1 4.1 Current balance Q2-2012 22.7 23.4 Federation Industrial production Q3-2012 0.6 2.7 Unemployment rate Consumer price index Q3-2012 2.3 6.0 Interest rate Q2-2012 7.3 4.7 2South Gross domestic product Q2-2012 0.8 2.7 Current balance .. .. Africa Industrial production .. .. Unemployment rate .. .. Consumer price index Q3-2012 0.9 5.2 Interest rate Q3-2012 5.1 5.5 Gross Domestic Product: Volume series; seasonally adjusted. Leading Indicators: A composite indicator based on other indicators of economic activity, which signals ..=not available cyclical movements in industrial production from six to nine months in advance. Consumer Price Index: Measures changes in average retail prices of a fixed basket 1Accession candidate to OECD of goods and services. Current Balance: Billion US$; seasonally adjusted. Unemployment Rate: % of civilian labour force, standardised unemployment rate; national 2 Enhanced engagement programme definitions for Iceland, Mexico and Turkey; seasonally adjusted apart from Turkey. Interest Rate: Three months. Source: Main Economic Indicators, November 2012 OECD Observer No 292 Q3 2012 63 DATABANK

Investment dries up

The fallout from uncertainty that continues outward investment, a staggering 48%. to undermine the global economy is Investments by Africa and the Middle International investment falls reflected in international investment, East, North America and Asia are also Trends in international mergers & acquisitions which is falling once again, following two expected to drop significantly. Latin years of steady gains. In 2011, international America had seemed to be bucking the $ billions IM&A Net IM&A mergers and acquisitions (IM&A) had trend as intra-regional deals in airlines, risen back up to just over US$1 trillion. steel, telecommunications and retail 1800 But according to the OECD’s Investment buoyed activity. However, IM&A into Latin 1600 News, investment activity is projected to America is set to fall by 30% in 2012. 1400 decline by as much as 36% in 2012, to 1200 $675 billion. The steep declines in IM&A reflect a 1000 deepening mistrust in the global state 800 This drop has been accompanied by of affairs–from concerns that the US 600 increased international divestment by is heading for a “fiscal cliff” to slowing 400 firms. When this divestment is taken into growth in China–that sees countries 200 account, the resulting net IM&A drops to succumbing to a protectionist impulse in 0

$317 billion, the lowest level seen since their trade and investment. 2010 2011 2003 2004 2005 2006 2007 2008 2009 *2012 2004. See www.oecd.org/investment *Linear projection based on data through August 2012 As the euro crisis drags on, Europe is Source: OECD Investment News, September 2012 expected to experience the largest drop in

Take a walk

Cities that want healthier populations should get them moving. In the US, where Walking trips urban sprawl and personal motorised Share of walking and average length of a walking trip in kilometres, selected countries vehicle are prevalent, walking makes up only 8.6% of all trips, by far the lowest % share of walking Average length in kilometres proportion in our chart. 0% 5% 10% 15% 20% 25% 30% US (2001) Of the OECD countries surveyed in New Zealand (2007) Pedestrian Safety, Urban Space and Health, The Netherlands (2007) Germany and Austria rank among the Belgium (1999) highest populations whose trips are Norway (2005) made entirely by walking, with average Finland (2004) trips by foot exceeding 25%. However, France (2008) in industrialised countries, the average Sweden (2006) length of a walking trip is quite short. For Germany (2002) the Swiss, while 28% of trips are made by Austria (2004) walking, 60% of them did not exceed 1 km, Switzerland (2005) and only 10% exceeded 2 km. The average 0km 0.5km 1km 1.5km 2km journey in Sweden is somewhat longer, at Source: OECD Pedestrian Safety, Urban Space and Health 2 km, with around 22% of all trips taken by foot. As for Americans, they may not walk often, but when they do, they walk further the reports points out, the best customers to non-motorised transportation, so that than the Swiss. are pedestrians. Policies that encourage cities themselves can aim for a healthier walking facilitate liveable, more compact waistline. Societies that walk are healthier, see less and sustainable cities. Indeed, urban traffic congestion, and have greater social planning should give greater weight to See www.internationaltransportforum.org equity and more vibrant economies–as mobility management, and particularly

64 Guaranteeing the quality of the electricity supply

Committed to the environment and to a sustainable energy future

Red Eléctrica has obtained the European EFQM award for business excellence in the category "Taking responsibility for a sustainable future"

RED ELÉCTRICA DE ESPAÑA www.ree.es At MSD, we work hard to keep the world well. How? By providing people all around the globe with innovative prescription medicines, vaccines, and consumer care and animal health products. We also provide leading healthcare solutions that make a difference. And we do it by listening to patients, physicians and our other partners — and anticipating their needs. Not just healthcare.

We believe our responsibility includes making sure that our products reach people who need them, regardless of where they live or their ability to pay. So we’ve created many far-reaching programs and partnerships to accomplish this. You can learn more about them at msd.com.

We continue on our journey to redefine ourselves to bring more hope to more people around the world. Our goals are clear and our commitment is fierce. We are dedicated to solving problems and pursuing new answers.

Copyright ©2011 Merck Sharp & Dohme Corp., a subsidiary of Merck & Co., Inc., Whitehouse Station, NJ, USA. All Rights Reserved.