Public spending is very high in Norway, partly reflecting an extensive coverage of the welfare system and ambitious regional development objectives. Moreover, several institutional features contribute to dampening the cost-effectiveness of many public-spending programmes. Abundant oil revenues...

In recent years, a series of wide-ranging reforms designed to make greater use of market mechanisms has succeeded in eliminating shortages, raising efficiency and improving citizen satisfaction. Nevertheless, spending accelerated after the reforms, and per capita spending on health is now one of...