The Organization for Economic Cooperation and Development (OECD) is a collaborative international governmental body dedicated to furthering economic progress and world trade. Currently, there are 35 member countries.
The OECD serves as a forum for member countries to compare policy experiences, identify good practices, work together to understand economic drivers and coordinate domestic and international trade policies. The OECD promotes democracy and strives to improve the market economy by working with unions, businesses and other worker group representatives.
The OECD was originally established as the Organization for European Economic Cooperation (OEEC) in 1948. Its original creation was part of post-WWII efforts by the United States to rebuild the economies of Western European countries by making governments accept the interdependence of their economies. In 1961, the OEEC was renamed to the OECD and members were allowed from non-European States.
The goals of the OECD include:
- Improving the quality of life, economic growth and employment to the highest sustainable levels.
- Contributing to the economic expansion of member and non-member countries.
- Increasing multilateral, nondiscriminatory world trade.
The OECD consists of three working components:
- Council – The council is responsible for oversight and strategic direction. It consists of representatives of member countries and the European Commission. The council meets once a year to discuss important issues and set priorities for the organization’s work.
- Committees – Committees are responsible for discussion and implementation. There are 250 committees with member representatives that meet to further objectives and evaluate progress in policy areas in specialized committees. The committees consist of both working and expert groups who review and contribute to work performed by the Secretariat.
- Secretariat – The Secretariat is responsible for statistical analysis and proposals. It supports the committees and carries out work decided by the OECD Council. The staff includes economists, lawyers, scientists and other professionals.
The OECD Secretariat collects and analyses data, the committees take the information and data to discuss policy, the Council makes strategic decisions, and then governments apply any recommendations.
The OECD works towards its goal of helping governments prosper through economic growth and stability in several ways. Peer reviews are used to monitor the compliance of member countries with OECD recommendations. The OECD releases up to 500 publications every year to broadcast their assessments and proposals, including annual summaries, outlooks and statistics. Agreements, standards and recommendations often derive from committee meetings. For example, the EU Data Protection Directive was adopted by the European Union based on recommendations first proposed by OECD.
Funded by contributions from its member countries, the OECD has a 363 million euro annual budget. The headquarters for the OECD is located in Chateau de la Muette in Paris, France.