Pierre Cahuc, Franck Malherbet, Julien Prat, 11 June 2019

Standard economic models predict that employment protection legislation reduces both job destruction and job creation, with the negative impact on job creation caused by the anticipation of separation costs. This column shows that in France, this anticipation effect not only plays a key role in reducing job creation but also increases job destruction among low-skilled workers, an effect that is amplified by the presence of the minimum wage. This mechanism implies that job protection is strongly detrimental to employment in the French context.

Clémence Berson, Morgane Laouénan, Emmanuel Valat, 27 April 2019

Hiring discrimination against ethnic minorities remains an important issue in most industrialised countries, but few tools have proven their effectiveness in fighting this discrimination. Based on an original correspondence study in France, this column argues that the organisation of recruitment has a large impact on discrimination.The findings suggest that companies that centralise HR practices across establishments are less likely to discriminate against minority ethnic applicants in the first round of selection.

Al Slivinski, Nathan Sussman, 20 March 2019

The problem of tax compliance is as old as the levying of taxes. Innovations in tax administration that induce high compliance rates at reasonable cost are extremely important to governments. This column demonstrates how the taille, a tax collection mechanism from medieval Paris, raised compliance by turning the social cost of tax evasion into a private one. It offers a tax collection model that is still relevant to governments today.

Laurence Boone, Antoine Goujard, 04 March 2019

The ‘yellow vest’ demonstrations in France appear, at least in part, to be another example of the anti-globalisation sentiment that has emerged in a number of OECD countries. This column argues that the movement is also rooted in the country’s broken social elevator. Redistribution through taxes and social transfers is not sufficient to curb the inequality in opportunity, which is mostly linked to the educational system and perpetuates economic and social situations from one generation to the next.

Daniel Hamermesh, Jeff Biddle, 26 January 2019

People combine goods and time in household production, and theory suggests that as their wage rates rise, they will substitute goods-intensive for time-intensive activities. However, it is not clear how activities that take essentially no, or minimal, amounts of spending, such as sleeping or watching TV, fit into the theory. This column uses data from time diaries for the US, France, and Germany to demonstrate that not all non-work time is the same, and different components of non-work time respond differently to changing incentives.

Thomas Le Barbanchon, Julien Sauvagnat, 08 December 2018

Despite many efforts to close the gender gap, women remain underrepresented in politics. This column shows that in the case of France, voters’ preferences towards gender shapes political selection and ultimately the gender composition of elected politicians. This suggests that gender parity in policymaking relies on improving the slow-changing attitudes of voters towards male and female political candidates.

Patrice Baubeau, Eric Monnet, Angelo Riva, Stefano Ungaro, 29 November 2018

Previous research has downplayed the role of banking panics and financial factors in the French Great Depression. This column uses a newly assembled dataset of balance sheets for more than 400 French banks from the interwar period to challenge this long-held idea. The empirical results show two dramatic waves of panic in 1930 and 1931, and point to a flight-to-safety mechanism. The findings illustrate how minor macroeconomic assumptions and extrapolations on monetary statistics can introduce large, persistent biases in historiography.

Guillaume Vuillemey, 17 November 2018

A key function of financial markets is to share risks, and thus to mitigate the transmission of shocks to the real economy. This column analyses one historical setup in which risk-sharing possibilities in financial markets suddenly increased – the creation of the first central clearing counterparty in 1882 in France in the market for coffee futures. The ability to better hedge coffee prices had real effects and increased trade flows Europe-wide. 

Peter Egger, Nora Strecker, Benedikt Zoller-Rydzek, 24 September 2018

The OECD estimates that more than $100 billon is lost each year to tax avoidance by MNEs. One way that firms do this is by using their size and mobility to bargain for tax breaks. This column uses French data to identify the nature of such bargaining. It finds that the scale of the projected tax payment accounts for 41% of the tax break, and a credible threat to relocate accounts for the rest.

Bertrand Garbinti, Jonathan Goupille-Lebret, Thomas Piketty, 05 September 2018

France is often considered to be an equalitarian country with a low level of inequality. Of course, this is true when compared to the United States, where inequality has skyrocketed recently. But the fact remains that France has also experienced a sharp rise in inequality. This column combines data from different sources to construct distributional national accounts and show the limits of the French myth of egalitarianism.

Morgan Kelly, Cormac Ó Gráda, 18 August 2018

Little is known about migration to cities in the era before railways. The column uses data on the origins of women arrested for prostitution in Paris in the 1760s, women registered as prostitutes in the 1830s and 1850s, men holding identity cards during the French Revolution, as well as everyone buried in 1833 to examine patterns of migration. Migration was highest from areas with high living standards, and the impact of distance fell as transport improved. Distance was a stronger deterrent to females than to males, consistent with more limited employment opportunities for women.

Janet Currie, Hannes Schwandt, Josselin Thuilliez, 10 August 2018

Understanding how inequalities in health are related to inequalities in income is a key issue for policymakers. This column describes how despite increasing income inequality in both countries, the development of mortality has been very different in France compared with the US. The findings show that inequalities in income and health do not necessarily move in tandem, and highlight how public policy helps to break this link. 

Pierre Cahuc, Francis Kramarz, Sandra Nevoux, 16 July 2018

Short-time work programmes aim to preserve jobs at firms that are experiencing temporarily low revenues, for example during a recession. This column assesses how the short-time work programme implemented in France during the Great Recession affected employment. Results confirm that the programme saved jobs and increased hours worked, and that participating firms recovered faster than non-participating firms. 

Ashoka Mody, 25 April 2018

Since Emmanuel Macron’s election as French president in May 2017, hope has lingered that a mythical friendship between France and Germany will help complete the gaps in the euro area architecture. As this column discusses, however, history provides no basis for such an expectation. National interests, always central to the decision calculus, have diverged even further. French leaders have a pressing task at hand: they need to rejuvenate their own economy and build domestic social cohesion. This may take a generation or more. 

Pauline Charnoz, Claire Lelarge, Corentin Trevien, 22 April 2018

Research has shown that lower communication costs can act as a centralising force, prompting workers tend to rely more on the help of others and to specialise on a narrower set of tasks. This column reveals how reduced travel times resulting from a new high-speed rail transport in France fostered functional specialisation across different units of firms and greater centralisation. The findings highlight the mechanisms determining the level and distribution of productivity in an economy, and their redistributive impact both between and within firms

Nicoletta Berardi, Patrick Sevestre, 13 March 2018

Identical products are often sold at different prices at different times and in different shops. This column uses data from 1,000 products across more than 1,500 stores to argue that, in France at least, consumers are in a relatively good position to decide where to go shopping. Expensive and cheap stores tend to be persistently expensive or cheap over time and across the products they most commonly sell, and the retail chain to which a store belongs is a good indicator of its expensiveness.

Pierre Cahuc, Stéphane Carcillo, Thomas Le Barbanchon, 09 January 2018

Despite their widespread use in the US and across Europe during the Global Crisis, the empirical evidence on the effectiveness of hiring credits is unclear, particularly in the context of recessions. This column uses the French hiring credit programme of 2008-09 to show that credits can be very effective at boosting job creation at low cost when they are unanticipated and temporary.

Julia Cagé, 23 December 2017

Conventional wisdom holds that more media competition makes citizens more informed, and that it improves the functioning of democracies. This column tests this claim using data on local newspaper circulation in France. It finds that increased media competition leads to business stealing and to a decrease in the coverage of public affairs news by local newspapers. It also has a negative impact on local election turnout. While competition is key to the quality of the media environment, the results highlight that more media competition is not necessarily socially efficient.

Youssef Benzarti, Dorian Carloni, 13 November 2017

In the wake of the Global Crisis, some governments sought to stimulate demand through VAT cuts. This column assesses the success of these measures by investigating who benefited from a VAT cut on sit-down restaurant meals in France. The results show that restaurant owners captured the lions’ share of the tax cut, while employees and consumers benefited substantially less. Further, following subsequent tax increases, restaurant owners increased their prices by four to five times more than they had decreased their prices following the original cut.

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