OECD - Multi-dimensional Review of Uruguay

Within the framework of the Strategy on Development, the OECD launched the first Multi-dimensional Country Review (MDCR) in 2013, a new series that looks at economic development along the lines of inclusive growth, examining patterns of growth that are equitable, sustainable and improve the overall well-being of citizens. The series aims to identify key constraints to broad-based development, and to formulate appropriate policy recommendations accordingly.

OECD Development Pathways is a new series that looks at multiple development objectives beyond an exclusive focus on growth. The report recognises that well-being is part of development and aims to help countries identify and overcome binding constraints to more equitable and sustainable growth. Governments trying to achieve economic, social and environmental objectives need to understand the constraints they face and to develop comprehensive and well-sequenced strategies for reform. MDCRs take a cross-cutting perspective, which allows for the discussion of policy interactions and trade-offs.

Uruguay is the second country to undertake a multi-dimensional review, and the first one in Latin America. The report is timely as, after a decade of economic prosperity, Uruguay is currently facing new challenges, some of them similar to those of OECD countries. The first volume of the review served to identify the binding constraints to Uruguays development. Several dimensions of the countrys economic and social development, including productivity outcomes, patterns of inequality and macroeconomic policies, were analysed. With this basis, the second volume of the review provides an in-depth analysis and recommendations to tackle Uruguays critical constraints to development. While the recommendations in this report are intended primarily to support public policy action by Uruguays national authorities, the findings are also beneficial for academics, the private sector and civil society.

The MDCRs are composed of three distinct phases: diagnosis, in-depth analysis of the binding constraints, and implementation. This phased approach allows for a progressive learning process about the countrys specific challenges and opportunities. A participatory workshop, two missions and discussions with authorities, private sector representatives and academia allowed for the preparation of the analysis and recommendations within this second report. Analytical work is based on available statistics on Uruguay, including macroeconomic and structural data, household and labour market surveys and other domestic and international sources.