The role of structural reform for adjustment and growth
Issue 34, June 2014
Structural reforms to labour and product markets help to improve economic growth prospects and the ability of economies to adjust to shocks by expanding flexibility and improving the efficiency of how and where productive factors are used. The recent financial and economic crisis prompted EU countries to under-take considerable reforms, which are now starting to show tentative results. Their full benefits, however, may take years to materialise, which means that governments must avoid the temptation to give up on them now that the economic situation is somewhat more comfortable.