Alexander Donges, Jean-Marie Meier, Rui Silva, 20 May 2022

A large part of the world operates under oligarchic and authoritarian regimes, where access to economic opportunities is not offered to all citizens. This column discusses the impact of such ‘extractive institutions’ in stifling innovation and future economic growth. Using novel hand-collected data, it documents that ‘inclusive institutions’, which promote equal access to economic opportunities, are a first-order determinant of innovation. Geographical regions with more inclusive institutions are able to produce more than twice as much innovation (proxied with patents per capita) as regions with worse institutions.

Nikolaj Broberg, Clemence Tricaud, Vincent Pons, Vestal McIntyre, 08 May 2022

Democracies around the world have instituted reforms to level their electoral playing fields. This column studies the impact of campaign finance regulations in French local elections. The authors find that such regulations, particularly state reimbursements of expenditures, can level the playing field and assist newcomers without decreasing the representativeness of elections.

Jean Benoit Eymeoud, 03 May 2022

It's hard to find good evidence on whether voters have a gender bias. But the voting format used in French local elections makes it possible to estimate the extent of this form of discrimination, and suggests what we can do about it.

Read more about this paper recently presented at the 75th Economic Policy Panel meeting: Gender Discrimination in Politics

Olivier Blanchard, Jean Tirole, 21 March 2022

A report generated by a commission of 24 distinguished economists focuses on three structural challenges for the global economy. The column sets out some of the conclusions. While the challenges of climate change, inequality and demographic change are significant, solutions – though sometimes expensive or unpalatable – exist.

Cédric Chambru, Emeric Henry, Benjamin Marx, 11 February 2022

One of the most remarkable achievements of the French Revolution for ordinary people was the reorganisation of local government. Cédric Chambru, Emeric Henry and Benjamin Marx tell Tim Phillips how local state capitals emerged as a result, and what this tells us about how state capacity develops.

Read the VoxColumn about this research: Chambru, C, Henry, E and Marx, B. (2022), Building a state one step at a time: Evidence from France, VoxEU.org, 03 February.

Download the free DP: Chambru, C, Henry, E and Marx, B. 2021. 'The Dynamic Consequences of State-Building: Evidence from the French Revolution'. CEPR

Cédric Chambru, Emeric Henry, Benjamin Marx, 03 February 2022

Effective states can raise taxes and armies, enforce laws, and produce public goods, but how these functions are built over time is not well understood. This column studies the administrative reform initiated by the French Revolution, one of history’s most ambitious state-building experiments, to shed light on the sequence of steps needed to build effective states. Cities chosen as local administrative centres initially invested in the state’s capacity to extract resources from citizens. These cities may not have grown in the short run, but the investments eventually delivered payoffs in terms of public goods, which stimulated long-run growth. 

Antonin Bergeaud, Jean Benoit Eymeoud, Thomas Garcia, Dorian Henricot, 18 January 2022

As employers and employees established ways of working remotely to limit physical interaction during outbreaks of Covid-19, teleworking became increasingly routine. This column examines how corporate real-estate market participants adjusted to the growth of teleworking in France, and finds that it has already made a noticeable difference in office markets. In départements more exposed to telework, the pandemic prompted higher vacancy rates, less construction, and lower prices. Forward-looking indicators suggest that market participants believe the shift to teleworking will endure.

Marco G. Palladino, Alexandra Roulet, Mark Stabile, 01 December 2021

What drives gender wage gaps – and how best to close them – remains a contested topic of economic research. Using data from matched employer-employee registers in France from 1995 to 2015, this column finds that discrepancies in pay are driven largely by men and women working in different firms rather than similar men and women being paid differently at the same firm. Understanding why the share of the gender gap ascribed to firms persists over time and across cohorts remains an essential policy puzzle for further reducing wage disparities. 

Laurent Ferrara, Valérie Mignon, 30 November 2021

The Covid-19 recession that hit the French economy was completely non-standard, characterised by an unprecedented and sharp contraction of activity. This column discusses recent findings from the French business cycle dating committee, which show that the recession reached its trough in the second quarter of 2020. Since the third quarter of 2020, the economy has been in a recovery phase, with the majority of commercial sectors experiencing an increase in activity. Nevertheless, past experiences suggest caution about future growth, especially regarding the policy support for economic activity. 

Anne Epaulard, Etienne Fize, Titouan Le Calvé, Philippe Martin, Hélène Paris, Kevin Parra Ramirez, David Sraer, 02 November 2021

Governments around the world announced fiscal support measures to keep businesses afloat in response to the Covid-19 shock. This column uses bank account data from 100,000 French firms to examine the solvency and liquidity of companies across sectors. Firms in the accommodation and food services sector are doing surprising well, while many firms in the construction sector are struggling financially. The findings suggests fiscal support may not have worked as intended, and that policymakers should continue to monitor bankruptcies closely in the coming months.

Margherita Russo, Claudia Cardinale Ciccotti, Fabrizio De Alexandris, Antonela Gjinaj, Giovanni Romaniello, Antonio Scatorchia, Giorgio Terranova, 02 August 2021

Many countries turned to use contact-tracing apps to help control the spread of COVID-19. Despite public policy efforts, however, tracking apps have not been a success because of public concerns over data privacy. This column compares nine countries to explore the conditions behind the successful use of digital technologies and AI for public purposes. Individuals give over personal data to internet companies but are wary of sharing their data for the public interest. Citizen trust in public interventions and commitment to social goals need to be nurtured in normal times to be effective in emergencies.

Laurent Ferrara, Valérie Mignon, 17 July 2021

Identifying the peaks and troughs of recessionary episodes helps economists to understand the conditions surrounding crises. But deciding when a recession starts or finishes is not straightforward, and several methods exist. This column presents the dating specification for the French Business Cycle Dating Committee, describing how the group identifies key phases in France’s economic performance based on a quantitative and a qualitative pillar. The committee has dated the peak of the recession linked to the recent Covid-19 pandemic to the last quarter of 2019, it is still too early to identify the exit date of this recession, which is unprecedented in its source and profile. 

Pierre Cahuc, Francis Kramarz, Sandra Nevoux, 26 May 2021

The Covid-19 crisis transformed short-time work into the first choice of policymakers across Europe. But this newfound enthusiasm should not obscure the dearth of studies addressing short-time work’s long-term consequences. Using detailed data covering the universe of French firms during the 2008-2009 Great Recession, this column finds that short-time work saved jobs in firms hit by powerful negative revenue shocks, but not in firms hit less severely. Still, short-time work remains a more cost-efficient way than wage subsidies to save jobs. 

Christian Gollier, 13 April 2021

Christian Gollier talks to Tim Phillips about vaccine rollout with regard to France, where modelling suggests a doubling of the speed of vaccination achieved in March could reduce deaths in 2021 by a third, while the presence of senior anti-vaxxers may imply around 5,000 additional deaths among the senior pro-vaxxer population (based on 30% of the population refusing the vaccine). Vaccine nationalism is estimated to increase the global death toll by 20%.

You can download the paper here: Gollier, C (2021), “The welfare cost of vaccine misallocation, delays and nationalism”, Covid Economics 74: 1-24 https://cepr.online/CE74

Christian Gollier, 09 April 2021

The slow development of the vaccination campaign in continental Europe raises critical questions around who should be prioritised in the roll-out, the welfare costs of a delay, and the impact of ‘anti-vaxxers’ and vaccine nationalism. This column uses an age-structured SIR model to addresses these issues with a focus on France. A doubling of the speed of vaccination France achieved in March could reduce deaths in 2021 by a third, while the presence of senior anti-vaxxers may imply around 5,000 additional deaths among the senior pro-vaxxer population (based on 30% of the population refusing the vaccine). Vaccine nationalism is estimated to increase the global death toll by 20%.  

Hélène Benghalem, Pierre Cahuc, Pierre Villedieu, 05 April 2021

The rise of alternative work arrangements – from temporary and part-time work to self-employment and online gig-economy jobs – has increased the take-up of part-time unemployment benefits in several countries. This column presents the results of a large experiment among recipients of unemployment-benefits insurance in France. It shows that increasing part-time unemployment benefits raises the propensity to work in non-regular jobs, but also extends the duration of compensated unemployment and unemployment insurance expenditure, suggesting that the lock-in effects of compensated unemployment associated with part-time benefits require precise evaluation.

Emanuel Moench, Loriana Pelizzon, Michael Schneider, 23 March 2021

In March 2020, a ‘dash for cash’ driven by the Covid-19 crisis affected the liquidity of the US Treasury bonds market as well as numerous other financial markets around the globe. This column investigates how euro area sovereign bond markets fared during the same period. While deteriorations in sovereign debt market liquidity are evident, these appear to be driven by a ‘dash for collateral’ in euro-denominated safe assets. This suggests some differences from the US experience, as well as variations across European countries. 

Matthieu Crozet, Julian Hinz, Amrei Stammann, Joschka Wanner, 05 March 2021

Sanctions are imposed on a target country to exert political and economic pressure. But there is little evidence on how exporting firms regard trade with the sanctioned country. This column uses detailed monthly customs data from French firms to investigate the extensive margin of trade in episodes of sanctions-use against Iran, Russia, Cuba, and Myanmar. It finds the impact of sanctions is heterogeneous along firm dimensions and advises caution in the use of a policy tool with imprecise and unpredictable results.

Philippe Aghion, Antonin Bergeaud, John Van Reenen, 01 February 2021

While there is suggestive evidence that regulations may have a stifling effect on innovation, there is as yet no rigorous economic framework to quantify the magnitude of such regulatory effects on innovation and the aggregate economy. This column proposes such a framework tests its implications on data from France. As the framework predicts, regulations do indeed hamper innovation, but the negative effects concern only incremental innovations and are absent for radical innovations.  Overall, regulations are estimated to reduce aggregate innovations by 5%. 

Julia Cagé, Anna Dagorret, Pauline Grosjean, Saumitra Jha, 17 January 2021

The events at the US Capitol earlier this month echo important moments in history where rioters protesting the state include former veterans and political heroes. This column uses novel evidence on extreme right-wing supporters and Nazi collaborators in France to show how democratic values can be undermined by exogenous networks of influential individuals, including military heroes. Heroes are specially positioned to widen the ‘Overton window’ and legitimise views previously considered deeply repugnant. Social networks of individuals sharing such an identity can transmit and reinforce this influence, leading to escalating commitments that entrench political positions and make debiasing more difficult.

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