Enhancing business dynamism and consumer welfare in Costa Rica with regulatory reform

Alberto González Pandiella

No 1615, OECD Economics Department Working Papers from OECD Publishing

Abstract: Regulations of product markets serve legitimate objectives but, when ill-designed, can impose unnecessary restrictions on competition, and therefore on business dynamism, productivity and ultimately well-being. A recent update of the OECD’s Product Market Regulation indicator for Costa Rica shows that there is ample room to improve regulations. Costa Rica’s economic development is hindered by heavy state involvement and high barriers to entry, compared to both OECD countries and regional peers. This paper discusses options to improve product market regulations, based on international best practices. Regulatory reform can improve consumer welfare by boosting competition and thus lowering prices of key goods and services, which in turn increases the purchasing power of low-income households and reduces poverty. By raising productivity, stronger competition will also allow higher wages. Reducing barriers to entry can facilitate firm creation, boosting investment and jobs.

Keywords: competition; inclusiveness; product market regulations; productivity (search for similar items in EconPapers)
JEL-codes: D4 K23 L1 L2 L3 L5 L8 L9 O54 (search for similar items in EconPapers)
Date: 2020-09-04
New Economics Papers: this item is included in nep-com and nep-ind
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1787/53250d35-en (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oec:ecoaaa:1615-en

Access Statistics for this paper

More papers in OECD Economics Department Working Papers from OECD Publishing Contact information at EDIRC.
Bibliographic data for series maintained by ().