François Langot

Using a general equilibrium heterogeneous agent model featuring health production, we quantify the contribution of health price in explaining cross-country differences in health expenditures and health status. Considering other country-specific explanatory factors, US health prices are estimated to be 33% higher than those of European countries. This price differential explains more than 60% of the difference in health expenditures and more than half of the difference in health status between Europe and the United States. Despite its large impact at the aggregate level, these price differences increase the lifetime cost of living of Americans by 2 percentage points.

Les conséquences économiques et environnementales des politiques françaises de transition énergétique doivent s’envisager dans le cadre d’une économie ouverte. Tout d’abord, le rythme des efforts et les modalités de la décarbonation de l’activité économique sont en partie dictés au niveau européen, comme dans le cas du marché de quotas d’émission pour les industries hautement émissives. Mais surtout, l’Accord de Paris inscrit l’effort français au sein d’une variété d’engagements nationaux de décarbonation, tant en termes d’ambition que d’instruments mis en œuvre pour y parvenir. Cette diversité des efforts et instruments au niveau international contribue à déterminer les effets économiques des choix faits en matière de politiques climatiques adoptées au niveau européen et français. Ce rapport propose un tour d’horizon synthétique de cette dimension internationale des politiques de transition énergétique. En dépit d’éléments communs, notamment leur objectif final de réduction de l’empreinte carbone de l’activité économique, les politiques climatiques des différents pays sont hétérogènes, qu’il s’agisse de leur ambition – à savoir le niveau de leurs engagements en termes de décarbonation – ou des politiques (prix, réglementations, subventions ou crédits d’impôt) mises en œuvre. Il est dès lors illusoire de tenter de réduire les effets de cette hétérogénéité à une métrique commune de l’effort de chaque pays, comme le serait un équivalent prix des mesures réglementaires ou incitatives en place dans les différents pays.

In this stated preferences study, we describe for the first time French citizens’ preferences for various epidemic control measures, to inform longer-term strategies and future epidemics. We used a discrete choice experiment in a representative sample of 908 adults in November 2020 (before vaccination was available) to quantify the trade-off they were willing to make between restrictions on the social, cultural, and economic life, school closing, targeted lockdown of high-incidence areas, constraints to directly protect vulnerable persons (e.g., self-isolation), and measures to overcome the risk of hospital overload. The estimation of mixed logit models with correlated random effects shows that some trade-offs exist to avoid overload of hospitals and intensive care units, at the expense of stricter control measures with the potential to reduce individuals’ welfare. The willingness to accept restrictions was shared to a large extent across subgroups according to age, gender, education, vulnerability to the COVID-19 epidemic, and other socio-demographic or economic variables. However, individuals who felt at greater risk from COVID-19, and individuals expressing high confidence in the governmental management of the health and economic crisis, more easily accepted all these restrictions. Finally, we compared the welfare impact of alternative strategies combining different epidemic control measures. Our results suggest that policies close to a targeted lockdown or with medically prescribed self-isolation were those satisfying the largest share of the population and achieving high gain in average welfare, while average welfare was maximized by the combination of all highly restrictive measures. This illustrates the difficulty in making preference-based decisions on restrictions.

Nous développons un modèle d’appariement qui reproduit l’impact de la chronique non-anticipée des restrictions liées à la crise de la Covid-19 sur le chômage français, en tenant compte de l’hétérogénéité entre les différents niveaux d’éducation. Nous identifions l’ampleur des restrictions sur les ventes de chaque segment du marché du travail, ainsi que le recours différencié aux mesures de chômage partiel. Nos résultats sont obtenus grâce à un modèle d’appariement original intégrant à la fois (i) des risques microéconomiques variant dans le temps et (ii) des externalités de congestion faisant varier les coûts unitaires de recrutement. Ensuite, (i) nous évaluons l’impact des mesures de chômage partiel sur les taux de chômage par diplôme, (ii) nous comparons différents scénarios de confinement (court mais strict versus long mais souple), et (iii) nous prévoyons l’impact d’un troisième confinement de Mars à avril 2021.

This study explains the impact of taxes and labor market institutions on the total hours observed in France, Germany, the United Kingdom, and the United States. We develop a balanced growth model with matching frictions in the labor market distinguishing between the extensive margin and intensive margin of labor supply. We show that (i) hours are more sensitive to changes in taxes, whereas employment reacts more to shifts in labor market institutions and (ii) a substitution effect exists between employment and hours. Counterfactual experiments show that if France had experienced the same trend in labor market institutions as the United States, its employment rate would have increased by 25 percentage points, whereas its number of hours worked per employee would have reduced by 1 percentage point. If France had chosen the US’ paths of both taxes and labor market institutions, then its employment rate would have been larger by 20 percentage points and the number of hours worked by employees would have been larger by 3 percentage points than the current one, a situation observed before the 1970s.

In this paper, we show that (i) the volatility of worker flows increases with age in US CPS data, and (ii)a search and matching model with life-cycle features, endogenous separation and search effort, is well suited to explain this fact. With a shorter horizon on the labor market, older workers’ outside options become less responsive to new employment opportunities, thereby making their wages less sensitive to the business cycle. Their job finding and separation rates are then more volatile along the business cycle. The horizon effect cannot explain the significant differences between prime-age and young workers as both age groups are far away from retirement. A lower bargaining power on the youth labor market brings the model closer to the data.

We study the welfare costs of business cycles in a search and matching model with financial frictions. The model replicates the volatility on labor and financial markets. Business cycle costs are sizable. Indeed, the interactions between labor market and financial frictions magnify the impact of shocks via (i) a credit multiplier effect and (ii) an endogenous wage rigidity inherent to financial frictions. In addition, in a nonlinear framework, large welfare costs of fluctuations are explained by the high average unemployment and the low job finding rates with respect to their deterministic steady-state values.

This paper proposes an equilibrium matching model for developing countries’ labor markets where the interaction between public, formal private and informal private sectors are taken into account. Theoretical analysis shows that gains from reforms aiming at liberalizing formal labor markets can be annulled by shifts in the public sector employment and wage policies. Since the public sector accounts for a substantial share of employment in developing countries, this approach is crucial to understand the main labor market outcomes of such economies. Wages offered by the public sector increase the outside option value of the workers during the bargaining processes in the formal and informal sectors. It becomes more profitable for workers to search on-the-job, in order to move to these more attractive and more stable types of jobs. The public sector therefore acts as an additional tax for the formal private firms. Using data on workers’ flows from Egypt, we show empirically and theoretically that the liberalization of labor markets plays against informal employment by increasing the profitability, and hence job creations, of formal jobs. The latter effect is however dampened or even sometimes nullified by the increase of the offered wages in the public sector observed at the same time.