Improving the business environment to accelerate convergence in Croatia

Timo Leidecker and Tim Bulman

No 1783, OECD Economics Department Working Papers from OECD Publishing

Abstract: Raising productivity growth is central to closing the gap with the incomes and well-being enjoyed in many OECD countries. Croatia has internationally competitive firms, and a dynamic economy with many young and potentially productive firms. However, overall performance has been limited by the presence of many less productive firms and more productive firms that often fail to grow. This likely reflects a business environment that weakens competitive pressures and makes investments more costly and risky. Reducing the burdens of lengthy and unpredictable regulatory procedures, resolving legal disputes faster with a more efficient judicial system, and improving public sector integrity, will be key for boosting productivity growth. Developing public equity markets and expanding R&D support would improve access to finance for young and innovative firms. State-owned enterprises play a comparatively large role in Croatia’s economy but tend to underperform financially and in delivering goods and services. Improving their governance, by strengthening the state’s oversight and governance arrangements, can improve outcomes. This Working Paper relates to the 2023 OECD Economic Survey of Croatia.

Keywords: access to finance; insolvency policies; law use; productivity analysis; public sector integrity; research & development policies; rule of law; state-owned enterprises (search for similar items in EconPapers)
JEL-codes: D24 D25 D31 D4 G2 K2 K4 L11 (search for similar items in EconPapers)
Date: 2023-12-12
New Economics Papers: this item is included in nep-law, nep-sbm and nep-tra
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Persistent link: https://EconPapers.repec.org/RePEc:oec:ecoaaa:1783-en

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