World Bank2012-06-192012-06-192005-11https://hdl.handle.net/10986/8396As Bulgaria approaches European Union accession, it has the opportunity to narrow the income gap, and raise productivity and investment, and set the economy on a higher growth path. To address these challenges and accelerate convergence with the European Union, this report proposes a reform agenda focused on five areas: productivity and growth, trade and investment integration, public expenditure policy, labor market adjustment, and the regulatory and institutional framework. Chapter 1 focuses on stability, growth dynamics, and integration. The analysis of these three fundamental dimensions over time is complemented with cross-country comparisons. Chapter 2 examines the foundations of Bulgaria's growth performance over the last several years in terms of the drivers of growth, intra-sectoral restructuring, growth accounting, and potential output growth. Trade policy, trade and FDI dynamics, and recent trends in trade performance are examined in Chapter 3, while Chapter 4 discusses the reforms needed in public expenditure policies to support deepening trade integration. Chapter 5 covers labor market performance and labor market policies and institutions. In Chapter 6, selected dimensions of the institutional framework for growth and competitiveness are examined, and Chapter 7 discusses macroeconomic policies aimed at addressing risks and vulnerabilities and supporting progress in monetary integration. Finally, Chapter 8 presents a summary of the main conclusions drawn from the report.en-USCC BY 3.0 IGOABSENTEEISMACTIVE LABORACTIVE LABOR MARKETACTIVE LABOR MARKET PROGRAMSAGGREGATE DEMANDAGRICULTUREAUTOREGRESSIONAVERAGE WAGESBANKING SUPERVISIONCAPITAL ACCUMULATIONCAPITAL INFLOWSCAPITAL STOCKCOMMERCECOMPETITIVE PRESSURESCOMPETITIVENESSCONSUMER GOODSCONSUMER PRICECONSUMER PRICE INDICESCONSUMERSCONTRACT ENFORCEMENTCONVERGENCECURRENCY BOARDDEBTDOMESTIC COMPETITIONDOMESTIC CONSUMERSDOMESTIC FIXED INVESTMENTDOMESTIC INVESTMENTDOMESTIC MARKETDOMESTIC MARKETSDRIVERSECONOMIC PERFORMANCEEXPENDITUREEXPENDITURESEXPORT MARKETSEXPORT PERFORMANCEEXPORTSEXTERNAL MARKETSFACTOR MARKETSFINANCIAL SECTORFIRM LEVELFISCAL POLICIESFOREIGN CURRENCYFOREIGN DIRECT INVESTMENTFOREIGN MARKETSGDPGLOBAL MARKETSGROSS DOMESTIC PRODUCTGROWTH PATHGROWTH RATEGROWTH RATESHUMAN CAPITALINCOME DIFFERENCESINCOME LEVELSINFLATIONINFORMAL ECONOMYINFORMAL SECTORINTEREST RATEINTEREST RATESINTERNATIONAL DEVELOPMENTINTERNATIONAL MARKETSINTERNATIONAL TRADEINVESTMENT CLIMATEINVESTMENT FLOWSINVESTMENT INTEGRATIONINVESTMENT RATEINVESTOR CONFIDENCELABOR ADJUSTMENTLABOR CONTRACTSLABOR COSTLABOR FORCELABOR FORCE PARTICIPATIONLABOR MARKETLABOR MARKET ADJUSTMENTLABOR MARKET PERFORMANCELABOR MARKET POLICIESLABOR MARKETSLABOR PRODUCTIVITYLABOR-INTENSIVE ACTIVITIESLIVING STANDARDSMACROECONOMIC POLICIESMACROECONOMIC STABILITYMARKET CONDITIONSMARKET SUPPLYMEMBER STATESMONETARY INTEGRATIONNET EMPLOYMENTPAYROLL TAXESPER CAPITA INCOMEPERFORMANCE INDICATORSPOLICY REFORMPOLITICAL ECONOMYPOTENTIAL OUTPUTPRIVATE INVESTMENTPRIVATE SECTORPRIVATE SECTOR ACTIVITYPRODUCER PRICEPRODUCER PRICE INDEXPRODUCTIVE ACTIVITIESPRODUCTIVITY GAPPRODUCTIVITY GROWTHPROTECTION SYSTEMPUBLIC EXPENDITUREPUBLIC SECTORPUBLIC WORKSPURCHASINGPURCHASING POWERREALLOCATING RESOURCESREFORM PROGRAMREGIONAL DEVELOPMENTREGULATORY FRAMEWORKREGULATORY REFORMREGULATORY REGIMESRETAILRETAIL TRADESALESSTANDARD OF LIVINGSTATISTICAL ANALYSISSTRUCTURAL REFORMSSURPLUSTELECOMMUNICATIONSTOTAL EMPLOYMENTTOTAL FACTOR PRODUCTIVITYTRADE INTEGRATIONTRADE PERFORMANCETRADE POLICIESTRADE POLICYTRADE UNIONTRANSITION ECONOMIESTRANSPORT COSTSTROUGHUNEMPLOYEDUNEMPLOYMENTUNEMPLOYMENT BENEFITSUNEMPLOYMENT RATEUNION REPRESENTATIVESUNSKILLED LABORVALUE ADDEDWAGESWORKERWORKERSWORLD ECONOMYWTOWorld Bank10.1596/8396