Tackling Europe's Competitiveness

The European socioeconomic system has for several decades been underperforming relative to the aspirations of many of its citizens, particularly in respect of the capacity to create jobs. This is increasingly ascribed to a lack of "competitiveness", by which is meant not insufficient cost or price competitiveness, but rather a lack of the full array of factors that lead to good economic performance. Much of this lack of European competitiveness in all probability derives from poor structural policies, although this is likely to be impossible to prove. Equally, it is very difficult to be sure which structural policies matter the most in Europe at present, but five are suggested as being of particular importance: greater flexibility, both of real wages and of working time; better policies to "top-up" low wage incomes; a fundamentally revised social attitude towards entrepreneurship; markedly enhanced education and training of the work-force, particular in later working life; and better educated markets. Copyright 1996 by Oxford University Press.