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Denmark: Selected Issues
Author:
International Monetary Fund. European Dept.
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Series:
IMF Staff Country Reports
Volume/Issue:
Volume 2024: Issue 293
Language:
English
Publication Date:
13 Sep 2024
DOI:
https://doi.org/10.5089/9798400288227.002
ISBN:
9798400288227
ISSN:
1934-7685
Pages:
32
Keywords:
mitigating factor; productivity shock; E. policy option; Policy consideration; shocks to Novo Nordisk; energy firm; covered bond bond market; Nonbank financial institutions; Labor productivity; Covered bonds; Systemic risk assessment; Productivity; Global
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This Selected Issues paper discusses the macroeconomic impact of the pharmaceutical sector. The analysis focuses on Novo Nordisk, the leading pharmaceutical company in Denmark, and its productivity impact on the rest of the economy. Empirical evidence suggests only weak correlations between productivity shocks at Novo Nordisk and overall economic growth, as well as between Novo Nordisk’s productivity and that of other firms. The findings suggest there is limited risk that Denmark’s booming pharmaceutical company would become its “Nokia.” Although the pharmaceutical sector will be a key driver of growth, most of its production occurs overseas under Danish ownership. As a result, its linkages with the rest of the domestic economy, in terms of employment and supply chains, are somewhat limited. The empirical results also indicate limited spillover effects through productivity channels. However, the empirical results may underestimate the influence of Novo Nordisk due to limited data.
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Cover IMF Staff Country Reports
IMF Staff Country Reports
ISSN:
1934-7685
Publisher:
International Monetary Fund