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“Thinking about the consequences of future shocks”

Clément Malgouyres is among the three economists, excluding the winner Eric Monnet, who were selected by the jury bringing together representatives of the Circle of Economists and the World, for their work relating to applied economics and promoting public debate.

How did your taste for economics come to you?

Firstly because it was very present in my childhood, with my parents who were farmers in Aveyron. They had one foot in a fairly pure version of the market economy with agricultural fairs and another in public policies, in particular because of the common agricultural policy.

During my studies, I was seduced by the idea of ​​being able to empirically examine the major phenomena that were discussed in economics classes, but without confronting them too much with the data. This is how I became interested in the effects of globalization on the labor market of advanced countries, by empirically examining the consequences for French employment areas of China’s irruption in world trade between 1995 and 2007.

And what did you find?

The overall effect on employment is moderate, but it is highly concentrated in certain sectors, such as manufacturers of toys or household appliances, and therefore in certain geographical areas. At the local level, the effects spread beyond the manufacturing sector: the local destruction of ten jobs in the manufacturing sector results in the disappearance of around six jobs in the service sector.

Finally, we note that, despite these difficulties, mobility remains low. Economic shocks move people little. As a result, the employment rate drops sharply in these regions. This finding of markets that react very locally, depending on their specialization, with workers who are not very mobile, is useful for thinking about the consequences of other shocks to come, such as the carbon tax, or technological shocks.

Read also: Article reserved for our subscribers Eric Monnet, 2022 Best Young Economist Award

What types of technological shocks have you studied?

I looked at the effect of broadband connection on business performance. We noted that in France the companies which equip themselves with high-speed Internet become much more active than the others as regards exchanges. They import many more products from a more diverse set of countries. Imports are even increasing faster than the rest of intermediate consumption. Technological progress is accelerating the growth of trade flows. This shows that new technologies and globalization have reinforced each other.

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