PEOPLE@HES-SO Annuaire et Répertoire des compétences

Labour, 2023, Vol. 37, No. 4, pp. 592-625

Résumé:

The paper provides a theoretical rationale for flexicurity policies, consisting of low employment protection, generous unemployment insurance and active labour market programmes. Education efforts give access to high productivity firms, more likely to survive and thus exposing less their workers to unemployment risk. Activation programmes support reallocation from risky and unproductive to safer and more productive firms, reducing unemployment. Low employment protection can provide incentives for self-insurance against unemployment risk through education, mitigating the moral hazard cost of unemployment insurance and activation programmes. The paper identifies conditions for flexicurity to be optimal and confronts theoretical predictions to the data.

The joint macroeconomic impacts of capital markets integration and fertility

Article scientifique ArODES

Review of international economics, 31, 2, pp. 687-720

Résumé:

Population aging puts pressure on the financing of pension systems in many developed economies over the long run. Higher fertility would reduce the speed at which a population ages, and thus ease the financing pressure. The positive fiscal externality of childbearing decisions is well known in a single-country context. I perform a quantitative investigation of this externality in a multi-country context, to investigate the role of capital markets integration. On a sample of 14 European countries confronted with population aging, I find with simulations that the fiscal gains from a 70-years increase in fertility are on average 1.3 larger with integrated capital markets than with separated capital markets in 50 years, while the GDP per capita gains are 5.0 larger. Positive fertility shocks indeed depress the capital-labor ratio, increase the interest rate and thus attract foreign investors, when capital markets are open. Fertility increases and capital markets integration are however not sufficient to deal fully with the public finance challenge generated by population aging. More reforms are needed.

2021

The long run influence of pension systems on the current account

Article scientifique

Davoine Thomas

Journal of Pension Economics and Finance, 2021

2016

Cross-country differences in the contribution of future migration to old-age financing

Article scientifique

Davoine Thomas, Johannes Berger, Philip Schuster, Ludwig Strohner

International Tax and Public Finance, 2016

2023

Redistribution contracts, public investments and cross-country transfers

Conférence ArODES

Proceedings of the Annual Congress of the Swiss Society of Economics and Statistics (SSES)

Résumé:

Cross-country transfers are made for multiple reasons, economic or not. There are a few theoretical justifications based on economic efficiency gains. I provide a new motivation, where tax-financed public investments are freed from social con- cerns over redistribution between generations, which can lead to efficiency gains. For public investment projects with twice larger expected returns than the aver- age, my simulations with 14 European countries show that GDP per capita gains at the aggregate level would be nearly twice smaller if cross-country transfers by high-income countries would be used for domestic investments, rather than entirely dedicated to finance public investments by low-income countries.

2022

Redistribution, efficiency and cross-country transfers within the European Union

Conférence ArODES

Proceedings of the 78th Annual Congress of the International Institute of Public Finance (IIPF), 2022

Résumé:

There exist few theoretical justifications for cross-country transfers within the European Union based on aggregate economic gains. I provide a new motivation, where tax-financed public investments are freed from concerns over redistribution between generations. For public investment projects with twice larger expected returns than the average, my simulations show that the Union-wide GDP per capita gains would be nearly twice smaller if cross-country transfers by high-income countries would be used for domestic investments, rather than entirely dedicated to finance public investments by low-income countries.

The joint macroeconomic impacts of capital markets integration and fertility over the long run

Conférence ArODES

Proceedings of the 37th Meeting of the European Economic Association (EEA), 2022

Résumé:

Population aging puts pressure on the financing of pension systems in many developed eonomies. Higher fertility would reduce the speed at which a population ages, and thus ease the financing pressure. The positive fiscal externality of childbearing decisions is well known in a single-country context. I perform a quantitative investigation of this externality in a multi-country context, to investigate the role of capital markets integration. On a sample of 14 European countries confronted with population aging, I find with simulations that the fiscal gains from an increase in fertility are on average 1.3 larger with integrated capital markets than with separated capital markets in 50 years, while the GDP per capita gains are 5.0 larger. Positive fertility shocks indeed depress the capital-labor ratio, increase the interest rate and thus attract foreign investors, when capital markets are open. As an example of policy implication, the plans for further integration of capital markets in the European Union provide an additional motivation for public policies designed to promote fertility in this region of the world, and vice-versa.

Cross-country differences in the long-run economic impacts of increased fertility

Conférence ArODES

Proceedings of the 78th Annual Congress of the International Institute of Public Finance (IIPF), 2022

Résumé:

Higher fertility slowly increases the workers-to-retirees ratio over the long run, which can ease the pension financing challenge brought about by population aging. It may or may not increase production per capita. Existing simulation studies all find a positive impact on public finances over the long run. They however differ on the impact on output per capita. Whether differences are due to model designs or country characteristics is unknown. Using the same macroeconomic model fora sample of 14 European countries, I find that the long-run pension deficits are reduced 27% on average, if one woman out of five had one more child in her lifetime. Variations across countries are small. On the other hand, I find that output per capita increases in all countries from my sample, with one exception. Differences in population structures, age-productivity profiles and pension systems can explain the exception. Fertility-promoting policies will always ease the public finance challenge due to population aging, but may worsen output per capita if pension payments are too loosely connected to earnings histories or if age-productivity profiles are very steep.

Ageing, education and skill-dependent labour supply elasticities

Conférence ArODES

Proceedings of the Annual Congress of the Swiss Society of Economics and Statistics (SSES), 2022