Michael Dean / OECD OECD Conference Centre entrance, Paris, January 2011.

Economic Coalition of the Willing

The OECD Reinvents Itself

For the past decade, a quiet experiment has been underway at the Organization for Economic Cooperation and Development (OECD), the Paris-based body composed of the United States and other advanced market democracies. Although it is often dismissed as sleepy and technocratic, the OECD has found a way to remain relevant in a quickly shifting global landscape, and other multilateral organizations would be wise to pay attention. 

The OECD, like numerous other international bodies, must adapt to changing geopolitical dynamics that have left new major global players outside its ranks. Its response is a so-called “key partner” initiative that allows it to engage—and seek to influence—pivotal nonmember states. This method strikes the right balance between maintaining the OECD’s symbolic role as the enforcer of Western norms and meeting its practical need to maintain a foothold on the global stage.  

A RICH MAN'S CLUB NO MORE

Despite the OECD’s low profile, no other institution so perfectly embodies the Western liberal order. The organization’s impressive ascent dates from the Marshall Plan. In 1948, Washington insisted that its European allies create a multilateral entity to coordinate postwar recovery efforts. The countries responded by forming the Organization for European Economic Cooperation, which in 1961 became the OECD and took on a transatlantic dimension by adding Canada and the United States. Between 1964 and 1973, the group incorporated Australia, Finland, Japan, and New Zealand and became truly global.

Throughout the Cold War, the OECD served as a standard setter in policy areas ranging from trade subsidies and economic development to corporate governance; education, health, and labor policy; and energy security and environmental protection. Its clout reflected the economic dominance of its members—which collectively accounted for 62 percent of global GDP by 1990—earning the group the nickname “rich man’s club.” The OECD’s traditional approach was to first negotiate common standards internally, then seek to win acceptance for them within more encompassing frameworks such as the United Nations and the successive negotiating rounds of the General

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