It's no longer possible for developed economies to spend their way out of their difficulties, the secretary general of the Organisation for Economic Co-operation and Development (OECD) told CNBC on Tuesday.
In order for the global economy to meet the G-20 target to create 2 percent additional gross domestic product (GDP) growth over the next five years they will no longer be able to rely on monetary or fiscal measures, Gurria said
"To [achieve 2 percent additional growth] you've got to go structural - we've used all the monetary policy room that we have, or [we] almost [have], and we've used all the fiscal policy room that we have," Gurria added.
Gurria said a more structural approach is needed to tackle the difficult issues such as education, innovation, competition and flexibility in labor and product markets.
"It's a more complex set of issues and they all have to be done in the right sequence and mostly as a simultaneous set rather than one single issue at a time," he added.
Gurria's comments on the exhaustion of economic policy echo those of Thomas Picketty, the author of 'Capital in the Twenty-first Century' who argues that an over reliance on central banks to fix economic problems is a major problem in the U.S. and Europe.
But Gurria said his view differs because he believes governments are running out of room to use fiscal policy – the use of government revenue collection (taxes) and expenditure to influence the economy – as well as monetary policy.