Is Europe Reforming? Evidence from Cross-Country Structural Indicators

Abstract

With the adoption of the Lisbon Agenda in 2000, the European Union established for itself the ambitious goal of becoming the most dynamic and competitive economy in the world by 2010. Despite initial optimism, the first half of the decade has been dispiriting and targets established under the Lisbon strategy will be difficult to achieve. Many observers have concluded that governments have failed to implement the policies required to achieve these targets and that, without radical changes, the strategy will fail to deliver its promises.

Without disagreeing with these conclusions, the present paper argues that they portray the situation excessively negatively. Using cross-country structural indicators compiled by the OECD, it shows that changes have occurred during the first half of the Lisbon programme, although not everywhere. Based on this overview, the paper raises some political economy issues related the method of coordination adopted by the Lisbon agenda.