What is the 'Organisation for Economic Co-operation and Development - OECD'

The Organisation for Economic Co-operation and Development (OECD) is a group of 34 member countries that discuss and develop economic and social policy. OECD members are democratic countries that support free market economies.

BREAKING DOWN 'Organisation for Economic Co-operation and Development - OECD'

The Organisation for Economic Co-operation and Development (OECD) is variously referred to as a think tank or monitoring group. Its stated goals include fostering economic development and cooperation; fighting poverty; and ensuring the environmental impact of growth and social development is always considered. Over the years, it has dealt with a range of issues, including raising the standard of living in member countries, contributing to the expansion of world trade and promoting economic stability.

The OECD was established on Dec. 14, 1960, by 18 European nations plus the United States and Canada. It has expanded over time to include members from South America and the Asia-Pacific region. It includes most of the highly developed economies.

Background of the OECD

In 1948, in the aftermath of World War II, the Organisation for European Economic Co-operation (OEEC) was established to administer the predominantly U.S.-funded Marshall Plan for post-war reconstruction on the continent. The group emphasized the importance of working together for economic development, with the goal of avoiding more decades of European warfare. The OEEC was instrumental in helping the European Economic Community (EEC), which has since evolved into the European Union (EU), to establish a European Free Trade Area.

In 1961, the United States and Canada joined the OEEC, which changed its name to OECD to reflect the broader membership. Fourteen other countries have joined since then as of 2016. It is headquartered in the Chateau de la Muette in Paris, France.

Functions

The OECD publishes economic reports, statistical databases, analyses and forecasts on the outlook for economic growth worldwide. Reports are variously global, regional or national in orientation. The group analyzes and reports on the impact of social policy issues such as gender discrimination on economic growth, and makes policy recommendations designed to foster growth with sensitivity to environmental issues. The organization also seeks to eliminate bribery and other financial crime worldwide.

The OECD maintains a so-called "black list" of nations that are considered uncooperative tax havens. It led a two-year effort with the Group of 20 (G20) nations to encourage tax reform worldwide and eliminate tax avoidance by profitable corporations. The recommendations presented at the end of the project included an estimate that such avoidance costs the world's economies between $100 billion and $240 billion in tax revenue annually. The group provides consulting assistance and support to nations in central and eastern Europe that implement market-based economic reforms.

RELATED TERMS
  1. International Energy Agency (IEA)

    The IEA works to ensure reliable, affordable and clean energy ...
  2. Economic Growth Rate

    An economic growth rate is a measure of economic development, ...
  3. Economic Integration

    Economic integration is an arrangement between different regions ...
  4. Economic Conditions

    Economic conditions are the state of the economy in a country ...
  5. Cooperative Insurance

    Cooperative insurance is for owners of co-op apartments – or ...
  6. European Monetary System - EMS

    The European Monetary System (EMS) is an arrangement between ...
Related Articles
  1. Insights

    Eyeing China? Consider These Economic Indicators

    If you're considering investing in China and want to know when to buy, sell, hold or stay away, consider these economic indicators.
  2. Insights

    Economic Indicators for Germany

    Here is a list of the top macro-economic indicator data sources for Germany.
  3. Insights

    U.S. Vs. China: Battle To Be The Largest Economy In The World

    America's lengthy title reign as "World's Largest Economy" is fast under threat by China's surging economic growth. Find out what the global rankings are forecasted to be for these economic powerhouses. ...
  4. Taxes

    Do U.S. High Corporate Tax Rates Hurt Americans?

    The United States has the highest corporate tax rate of the 34 developed, free-market nations that make up the Organization for Economic Cooperation and Development (OECD).
  5. Insights

    Where To Find Economic Indicator Data For Brazil

    Once an emerging economic powerhouse, the Brazilian economy is now struggling. Here is the list of primary economic indicators and sources to get Brazil's economic indicators.
  6. Investing

    Emerging Markets: Analyzing South Korea's GDP

    South Korea's transition from a war-devastated poor country to an affluent developed nation presents a phenomenal growth story.
  7. Taxes

    Which Countries Have High Taxes on High Incomes?

    For high earners in these countries, the tax rate percentage on income exceeding a certain threshold can reach into the high 50s and low 60s.
  8. Financial Advisor

    Latin America’s Economic Forecast

    After a ten-year run, the economies of Latin America are in a decline. For sustainable, long-term growth, the region needs structural reforms.
  9. Retirement

    How the U.S. Ranks on the Global Retirement Index

    America moved up one rank since 2017 to the 16th best country for retirement. Here's why it's only in the middle of the pack.
  10. Insights

    A Look Into Foreign Direct Investment Trends

    Foreign direct investments play an important role as an indicator of a healthy economy in terms of economic growth and long-term capital movement.
RELATED FAQS
  1. What country spends the most on healthcare?

    Find out which countries spend the most on health care, and understand some different methods for measuring these rankings ... Read Answer >>
  2. What impact does economics have on government policy?

    Learn about the impact of economic conditions on government policy and understand how governments engineer economic conditions ... Read Answer >>
  3. The differences between capitalism and socialism

    One promotes free market conditions, the other incorporates elements of centralized economic planning. Read more to learn ... Read Answer >>
  4. Is Mexico an emerging market economy?

    Learn the difference between a developed economy and an emerging market economy, and understand why Mexico is an emerging ... Read Answer >>
  5. Is Colombia an emerging market economy?

    Learn the definition of an emerging market economy, and understand how Colombia, while not yet developed, meets the standards ... Read Answer >>
  6. When and why did the euro make its debut as a currency?

    On January 1, 1999, the European Union introduced its new currency, the euro. Learn more about its history. Read Answer >>
Trading Center