Question A:
Revising France’s labor market policies — by reducing employment protection, decentralizing labor negotiations to the firm level, and making training programs more accessible and responsive to labor demands — would, all else equal, increase productivity in France’s economy.
Responses
Responses weighted by each expert's confidence
Question B:
Reducing employment protection would reduce the equilibrium unemployment rate in France.
Responses
Responses weighted by each expert's confidence
Question A Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
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 Philippe Aghion |
Harvard | Did Not Answer | Bio/Vote History | |
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 Franklin Allen |
Imperial College London | Bio/Vote History | ||
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Giving flexibility should improve things in the long run. The short run effects may be more problematic if there is a lot of dissent,
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 Pol Antras |
Harvard | Bio/Vote History | ||
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 Richard Baldwin |
The Graduate Institute Geneva | Did Not Answer | Bio/Vote History | |
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 Timothy J. Besley |
LSE | Bio/Vote History | ||
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 Olivier Blanchard |
Peterson Institute | Bio/Vote History | ||
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those reforms are the right ones and should be implemented. Based on past empirical evidence, they should work. But one can never be sure.
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 Nicholas Bloom |
Stanford | Bio/Vote History | ||
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France is death by red tape - what the US could become with 20 more years of creep of regulations and occupational licensing
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 Richard William Blundell |
University College London | Bio/Vote History | ||
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Increasing productivity has been a particularly difficult nut to crack, and not just in France. Some careful deregulation is a key part.
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 Agnès Bénassy-Quéré |
Paris School of Economics | Bio/Vote History | ||
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The extensive margin of productivity growth is relatively poor in France + the training system is very unequal, both for youth and adults.
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 Elena Carletti |
Bocconi | Bio/Vote History | ||
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 Jean-Pierre Danthine |
Paris School of Economics | Bio/Vote History | ||
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 Paul De Grauwe |
LSE | Did Not Answer | Bio/Vote History | |
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 Jan Eeckhout |
UPF Barcelona | Bio/Vote History | ||
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 Ernst Fehr |
Universität Zurich | Did Not Answer | Bio/Vote History | |
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 Xavier Freixas |
Barcelona GSE | Did Not Answer | Bio/Vote History | |
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 Nicola Fuchs-Schündeln |
Goethe-Universität Frankfurt | Bio/Vote History | ||
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 Jordi Galí |
Barcelona GSE | Bio/Vote History | ||
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 Luis Garicano |
LSE | Bio/Vote History | ||
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My own research (with Van Reenen and Lelarge) shows size dependent labour regulations make it hard for productive firms to grow
-see background information here |
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 Francesco Giavazzi |
Bocconi | Bio/Vote History | ||
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The positive experience of the Italian jobs Act
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 Rachel Griffith |
University of Manchester | Bio/Vote History | ||
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 Veronica Guerrieri |
Chicago Booth | Bio/Vote History | ||
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 Luigi Guiso |
Einaudi Institute for Economics and Finance | Bio/Vote History | ||
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there is poor shared consensus in France to labor market liberalization anoductivity negatively
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 Martin Hellwig |
Max Planck Institute for Research on Collective Goods | Did Not Answer | Bio/Vote History | |
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 Patrick Honohan |
Trinity College Dublin | Bio/Vote History | ||
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This is a conplex political economy issue. If done well, could increase employment and TFP in long run; short-run cloudy.
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 Henrik Kleven |
Princeton | Did Not Answer | Bio/Vote History | |
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 Jan Pieter Krahnen |
Goethe University Frankfurt | Bio/Vote History | ||
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The second policy option in the list (decentralized labor negotiations) may backfire, boosting strike incentives and lowering productivity.
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 Per Krusell |
Stockholm University | Bio/Vote History | ||
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Managing training programs is not necessarily so easy but I take the view that significant improvement is feasible.
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 Botond Kőszegi |
Central European University | Bio/Vote History | ||
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 Eliana La Ferrara |
Harvard Kennedy | Bio/Vote History | ||
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 Christian Leuz |
Chicago Booth | Bio/Vote History | ||
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Unclear as UE protection can also spur firm-specific invt & more lab flex brings in less prod wrkrs; FR prod already among highest in world
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 Costas Meghir |
Yale | Did Not Answer | Bio/Vote History | |
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 Peter Neary |
Oxford | Bio/Vote History | ||
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"All else equal" agreed. But it risks triggering further disillusionment with globalization. Accompanying macro stimulus would ease the pain
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 Kevin O'Rourke |
Oxford | Bio/Vote History | ||
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This is a very odd question, given that French labour productivity is so high.
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 Marco Pagano |
Università di Napoli Federico II | Bio/Vote History | ||
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Theory & evidence broadly support these predictions. BUT it is key that reforms are not done so as to reinforce a dualistic labor market.
-see background information here -see background information here -see background information here |
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 Lubos Pastor |
Chicago Booth | Bio/Vote History | ||
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Unclear. If such reforms create jobs mostly for people with below-average productivity, aggregate productivity will go down.
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 Torsten Persson |
Stockholm University | Bio/Vote History | ||
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 Christopher Pissarides |
London School of Economics and Political Science | Bio/Vote History | ||
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The reforms listed help but they are not the only factors influencing productivity
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 Richard Portes |
London Business School | Bio/Vote History | ||
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Look at Germanyand Sweden. Rigid contracts with high termination costs, as in France, just result in high youth unemployment, precariousness
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 Canice Prendergast |
Chicago Booth | Bio/Vote History | ||
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 Lucrezia Reichlin |
London Business School | Bio/Vote History | ||
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 Rafael Repullo |
CEMFI | Bio/Vote History | ||
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 Hélène Rey |
London Business School | Bio/Vote History | ||
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Flex -security (scandinavian model) would raise productivity. Certainly not the same as decreasing employment protection.
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 Antoinette Schoar |
MIT | Bio/Vote History | ||
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 John Van Reenen |
LSE | Bio/Vote History | ||
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My 2016 AER piece shows a French GDP loss of about 3.4% due to heavy labor regulation for firms over 50 employees
-see background information here -see background information here |
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 John Vickers |
Oxford | Bio/Vote History | ||
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 Hans-Joachim Voth |
University of Zurich | Bio/Vote History | ||
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Longer-term contracts can be a good thing for prouctivity, if firms and workers invest in the "match"...
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 Beatrice Weder di Mauro |
The Graduate Institute, Geneva | Bio/Vote History | ||
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 Karl Whelan |
University College Dublin | Bio/Vote History | ||
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Probably not a big effect. Would also bring some relatively lower productivity workers into employment This would lower average productivity
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 Charles Wyplosz |
The Graduate Institute Geneva | Bio/Vote History | ||
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So far high direct and indirect labor costs have forced firms to achieve very high labor productivity through saving on employment.
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 Fabrizio Zilibotti |
Yale University | Bio/Vote History | ||
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Question B Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
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Philippe Aghion |
Harvard | Did Not Answer | Bio/Vote History | |
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Franklin Allen |
Imperial College London | Bio/Vote History | ||
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This seems to have been the case in other countries. The unions response may lead to a different outcome in the case of France.
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Pol Antras |
Harvard | Bio/Vote History | ||
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Given the current environment it seems extremely likely that the impact on job creation would far outweigh the lower cost of job destruction
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Richard Baldwin |
The Graduate Institute Geneva | Did Not Answer | Bio/Vote History | |
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Timothy J. Besley |
LSE | Bio/Vote History | ||
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Olivier Blanchard |
Peterson Institute | Bio/Vote History | ||
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Such a reform changes the nature of unemployment (shorter duration, higher flows) for the better. Net effect on the rate is ambiguous.
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Nicholas Bloom |
Stanford | Bio/Vote History | ||
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Richard William Blundell |
University College London | Bio/Vote History | ||
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The key is a balance of both human capital and employment. Youth unemployment is a major issue. The redesign of emp p is central to this.
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Agnès Bénassy-Quéré |
Paris School of Economics | Bio/Vote History | ||
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It would reduce employment inequalities but maybe not the aggregate unemployment rate which depends also on a better matching process.
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Elena Carletti |
Bocconi | Bio/Vote History | ||
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Jean-Pierre Danthine |
Paris School of Economics | Bio/Vote History | ||
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Paul De Grauwe |
LSE | Did Not Answer | Bio/Vote History | |
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Jan Eeckhout |
UPF Barcelona | Bio/Vote History | ||
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More than reducing the unemployment rate, it would lead to a huge reduction in unemployment duration.
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Ernst Fehr |
Universität Zurich | Did Not Answer | Bio/Vote History | |
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Xavier Freixas |
Barcelona GSE | Did Not Answer | Bio/Vote History | |
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Nicola Fuchs-Schündeln |
Goethe-Universität Frankfurt | Bio/Vote History | ||
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Jordi Galí |
Barcelona GSE | Bio/Vote History | ||
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It is likely to increase employment volatility (bad, it may improve efficiency (good), but the effect on the unemployment rate is unclear.
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Luis Garicano |
LSE | Bio/Vote History | ||
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Again see our research and our summary of other´s work
-see background information here |
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Francesco Giavazzi |
Bocconi | Bio/Vote History | ||
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Rachel Griffith |
University of Manchester | Bio/Vote History | ||
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Veronica Guerrieri |
Chicago Booth | Bio/Vote History | ||
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Luigi Guiso |
Einaudi Institute for Economics and Finance | Bio/Vote History | ||
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may be frcitional unemploymnet may be marginally affected in the long run
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Martin Hellwig |
Max Planck Institute for Research on Collective Goods | Did Not Answer | Bio/Vote History | |
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Patrick Honohan |
Trinity College Dublin | Bio/Vote History | ||
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A long run equilibrium
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Henrik Kleven |
Princeton | Did Not Answer | Bio/Vote History | |
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Jan Pieter Krahnen |
Goethe University Frankfurt | Bio/Vote History | ||
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I only note in passing that the relationship between equilibrium unemployment rate and welfare is likely to be non-monotonic.
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Per Krusell |
Stockholm University | Bio/Vote History | ||
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It may not do so immediately. One can do a reform with grandfathering though, leaving currently employed workers with protection.
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Botond Kőszegi |
Central European University | Bio/Vote History | ||
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Eliana La Ferrara |
Harvard Kennedy | Bio/Vote History | ||
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Christian Leuz |
Chicago Booth | Bio/Vote History | ||
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Ambig evidence & theory bc opposite effect on turnover & duration; likely composition effect (CDD to CDI), which could be good for young
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Costas Meghir |
Yale | Did Not Answer | Bio/Vote History | |
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Peter Neary |
Oxford | Bio/Vote History | ||
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All else equal again. And the details matter. Something like Danish "flexicurity" would be good, naive deregulation bad.
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Kevin O'Rourke |
Oxford | Bio/Vote History | ||
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Given hysteresis in labour & political markets, SR impacts of such reforms can matter in LR, & depend inter al on accompanying macropolicies
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Marco Pagano |
Università di Napoli Federico II | Bio/Vote History | ||
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This is likely in the long-run. But in the short run the effect may be the opposite due to job destruction in overmanned firms.
-see background information here |
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Lubos Pastor |
Chicago Booth | Bio/Vote History | ||
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Long-run effects more favorable than short-run.
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Torsten Persson |
Stockholm University | Bio/Vote History | ||
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Christopher Pissarides |
London School of Economics and Political Science | Bio/Vote History | ||
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The policy would increase labor turnover but not necessarily reduce unemployment
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Richard Portes |
London Business School | Bio/Vote History | ||
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France is textbook 'insider' vs 'outsider' labor market. And we see textbook outcome.
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Canice Prendergast |
Chicago Booth | Bio/Vote History | ||
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Lucrezia Reichlin |
London Business School | Bio/Vote History | ||
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Rafael Repullo |
CEMFI | Bio/Vote History | ||
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Hélène Rey |
London Business School | Bio/Vote History | ||
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Short run effects would depend on when it is implemented. It would increase unemployment in a downturn.
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Antoinette Schoar |
MIT | Bio/Vote History | ||
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John Van Reenen |
LSE | Bio/Vote History | ||
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John Vickers |
Oxford | Bio/Vote History | ||
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Hans-Joachim Voth |
University of Zurich | Bio/Vote History | ||
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Modern labor econ overwhelmingly suggests that firms have a lot of market power; that means that this is likely but not guaranteed
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Beatrice Weder di Mauro |
The Graduate Institute, Geneva | Bio/Vote History | ||
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Karl Whelan |
University College Dublin | Bio/Vote History | ||
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It is likely that high levels of employment protection raise the natural rate of unemployment. But this is just one of many factors.
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Charles Wyplosz |
The Graduate Institute Geneva | Bio/Vote History | ||
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No brainer
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Fabrizio Zilibotti |
Yale University | Bio/Vote History | ||
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