CHUSSEAU Nathalie

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Starting from the diagnosis that Germany has had better economic outcomes than most advanced countries since the mid-2000s, we propose a general equilibrium model to answer the following two questions: Why is it so and is the German experience applicable to other EU countries? Whereas a large number of observers explain German competitiveness by the labour market reforms implemented from 2003 to 2005 (Hartz laws), we suggest that (i) the gains in competitiveness are essentially due to offshoring and (ii) the labour market reforms have subsequently reduced the offshoring-related unemployment by decreasing the reservation wage, creating thereby low skilled jobs in non-tradable services. These reforms have also reinforced inequality already generated by offshoring. In contrast with the traditional explanation based on the Hartz reforms, our model findings and simulations fit well with the sequence of observed facts. This experience could be extended to other EU countries, but with higher cost and lower efficiency. Finally, as the reduction in unemployment is based on the extension of non-tradable services, we suggest alternative policies that reach the same goal without increasing inequality.

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In the case of France, we analyse the changes (i) in the skill premium linked to each level of education and (ii) in the impact of parents’ skill and income upon the educational attainment of their children. To this end, we build a theoretical model which is subsequently estimated. Our calculations firstly reveal (i) a critical decline in the skill premium of the Baccalaureate in relation to the lowest skill level, and (ii) an increase in the skill premia of higher education in relation to the Baccalaureate, which however is not large enough to avoid the decrease in all the skill premia relative to the lowest skill. Secondly, we find (i) a significant increase in the impact of the family backgrounds upon the individuals’ education from 1993 to 2003 which essentially derives from a higher impact of parental income upon the educational attainment, and (ii) an increase in the impact of public expenditure upon education. Consequently, if inequality has decreased among the employed population, the slowdown in intergenerational mobility could reverse this tendency in the longer term. This may however be offset by higher public educational expenditure.

This paper analyzes the interactions between technical progress and North-South openness to explain the increase in wage and employment inequalities between skilled and unskilled workers observed over the last twenty-five years in industrialized countries. We construct a North-South general equilibrium model with endogenous growth aiming at integrating in a unified approach the interactions between North-South openness, the computerization of productive processes, and factor wages. This model is simulated in three main scenarios: autarky in the North, competitive North-South openness, openness with a minimum wage in the North. The results are: - The shift to competitive openness leads to a sharp increase in the skill premium and a slowdown in technical progress and productivity. - The minimum wage creates unemployment among the unskilled, but increases technical progress, productivity, and real income per capita in the long run.