Agnès Bénassy Quéré

We analyse how the combination of firm-level financial fragility and country-level financial constraints affect productivity growth in France, Italy and Spain. We first show that, although high leverage weighs on firm-level productivity in all three countries, more leveraged firms seem to suffer more from financial constraints only in Italy. In a second step, we show that this apparent specificity of Italian firms is related to the relatively short maturity of their debt. These results highlight the importance of liquidity constraints during periods of financial stress such as the Global Financial Crisis of 2008 or the European sovereign debt and banking crisis of 2011-13.

We revisit the standard theoretical model of tax competition to consider imperfect mobility of both capital and labor. We show that the mobility of one factor affects the taxation of both factors and that the ”race-to-the-bottom” narrative (with burden shifting) applies essentially to capital-exporting countries. We validate our predictions using a panel of 29 OECD countries over the period of 1997–2017. The quantitative contribution of rising capital mobility to the decline of corporate income tax rates over our sample period is nonetheless less than that of population ageing.

The debate on trade and currency wars has reemerged since the Global Financial Crisis. We study the two forms of noncooperative policies within a single framework. First, we compare the elasticity of trade flows to import tariffs and to the real exchange rate, based on product-level data for 110 countries over the 1989–2013 period. We find that a 1% depreciation of the importer’s currency reduces imports by around 0.5% in current dollar, whereas an increase in import tariffs by 1 percentage point reduces imports by around 1.4%. Hence, the two instruments are not equivalent. Second, we build a stylized short-term macroeconomic model where the government aims at internal and external balance. We find that, in this setting, monetary policy is more stabilizing for the economy than trade policy. One implication is that, in normal times, a country will more likely react to a trade “aggression” through monetary easing rather than through a tariff increase. However, both instruments are (imperfect) substitutes in the short term, when only one of them is available.

Les crises ont profondément transformé la politique économique. La tempête financière de 2008, la Grande Récession qui a suivi et les déboires de la zone euro ont ébranlé les certitudes passées et appellent de nouvelles réponses. Le niveau très faible de l’inflation, la baisse des taux d’intérêt, le ralentissement de la croissance, la hausse des dettes publiques, la montée de l’urgence écologique et l’augmentation des inégalités ont mis en cause l’ordre des priorités. Des chapitres oubliés de la théorie économique ont été relus et des instruments nouveaux ont été mis en place. Pour tenter d’endiguer la crise économique déclenchée par la pandémie de Covid-19, il est indispensable de s’appuyer sur un cadre analytique clair. Comment distinguer les chocs qui affectent l’offre et la demande ? Quelles sont les limites de l’endettement public ? Que peut la politique monétaire lorsque l’inflation est voisine de zéro et comment doit-elle s’articuler avec la politique budgétaire ? Comment stimuler l’emploi ? Comment limiter les inégalités et relancer l’activité en verdissant la croissance ? Si chaque crise est spécifique, les instruments à la disposition des gouvernements et des banques centrales se sont bâtis au fil des décennies et leurs effets sont de mieux en mieux compris. Au croisement de la recherche économique et de la pratique, Politique économique rend compte de ce savoir accumulé et dresse l’inventaire des nouvelles questions. Ce manuel s’est imposé depuis plus de dix ans comme la référence pour comprendre les politiques économiques d’aujourd’hui. Cette cinquième édition a été mise à jour.

We revisit the standard theoretical model of tax competition to consider imperfect mobility of both capital and labor. We show that the mobility of one factor affects the taxation of both factors, and that the “race-to-the-bottom” narrative (with burden shifting) applies essentially to capital-exporting countries. We validate our predictions using a panel of 29 OECD countries over the period 1997-2017. The quantitative contribution of rising capital mobility to the decline of corporate income tax rates over our sample period is nonetheless less than that of population ageing.

As the global response to the Covid-19 pandemic undoubtedly complicates economic forecasting for the eurozone, it is all the more important to try and predict the pace for its recovery: placing the bet right on a v-shaped or a swoosh-shaped recovery will have huge implications for businesses and economic policy actors alike, as well as on companies’ resilience building in the long run. Nevertheless, one specific outcome is bound to emerge as the legacy of the present crisis: a surge in sovereign debt, thus a threat to financial stability. In this chapter, we therefore examine the different policy outcomes and their aftermath, especially concerning risks, opportunities and means for dealing with the Covid-19 legacy within the existing monetary institutions and mechanisms of the European Union.

We analyse the impact of both the Global Financial Crisis of 2008 and the European sovereign and banking crisis of 2011-13 on firm-level productivity in France, Italy and Spain. We show that relying on a single break date in 2008 misses both the Eurozone crisis and countries’ institutional specificities. Although leverage and financial constraints affect firm-level productivity negatively, high-leverage firms suffer more from financial constraints only in Italy, when they are relatively small or when their debt is of short maturity. These results call for approaches taking into consideration country-level characteristics of financial institutions and time varying financing constraints of the firms, instead of pooling data and adopting a common break date. One size does not fit all when it comes to identifying the impact of financial crises on firm level productivity.

After an increase of the number of students, French University is facing competition on a local and international level since 2000 (Benhenda Dufour 2015). In the same period, Internet and the digital choose began to change communication , learning, teaching, cooperation between teachers and the skills required to teach (Baron Bruillard 2000). In this context, various injunctions are made to teachers to improve their teaching efficiency using digital technology and be more innovative. Some recent decree (2016) also defined the role of educational engineer to help French Universities to adapt to ICTs. Thus, a research team composed of an educational engineer, a researcher in sociology of Education, a professor of Macro-Economics and a phD candidates in economy who also was a teacher assistant designed an experiment on making videos and active pedagogy (Green 2014, Fiorella Mayer 2014) based on Epstein Beauchamps (2014) hoping that, according to the SoTL framework (Brew 2011), both the students and the teachers would improve their learning/teaching. The experiment took place at bachelor level in Macro-Economy where courses are organized as an ex cathedra amphitheater in large groups of students followed by exercise classes in smaller groups. The expected outcomes of the experiment was to improve the learners’ grades at the exam, long term learning, and to increase the « 21rst century’s skils » such as creativity, critical thinking or cooperation. Also, we expected teachers and teachers’ assistants to develop their own abilities. Over the 2018-19 academic year, two groups of students taught by the same assistant were identified. One of them was “treated” whereas the other one was kept as the control group. The tested students were asked to make short videos on defined technical aspects of the program, instead of the exercises normally solved during these classes. After the experiment was over, the grades obtained at the final exam were compared. After controlling for a number of factors explaining the grades at individual level (age, gender, past results), the tested group was found to perform significantly better than the control group. Online surveys and qualitative interviews were also carried out and analyzed according to the grounded theory approach. They suggest that treated students felt they were less prepared to the final test than regular students (cf Deslauriers and al 2019). However they were happy with their experience, especially due to more social interactions within the group. Over the 2019-20 academic year, the experiment was extended to 5 tested groups and 5 control groups – hence a total of 300 students out of 700 in the amphitheater. This extension allowed to assign different teaching assistants (one for each pair of tested-control), with differing skills. The quantitative results are not yet available. The qualitative interviews suggest that teaching assistants found the format relatively demanding but more rewarding and less stressful than the standard format. Their role in class was completely transformed. This feature is also important with respect to the attractiveness of the job for young talented scholars and training of teachers. The experiment was carried out in a class of International monetary economics taught by an experimented Professor who has already developed several interaction tools in amphitheater. International monetary economics is a mandatory discipline, usually considered as demanding and technical by the students. The challenges of the experiment are quite general in terms of activation of leaning skills and deep learning. We are trying to understand how the digital tools and the active pedagogy work to improve the students’ results, to confirm to what extent we can generalize the experiment to other contexts and what did work for the teachers’assistants self developpement.