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We propose a mechanism that explains standard stylized facts in both international macroeconomics and international finance. To do so, we develop a New Keynesian DSGE model with financial frictions a la Bernanke et al. (1999), in which we depart from the full-information rational expectations (FIRE) assumption. The key ingredient is home information bias (HIB) in expectations. While the FIRE model predicts high consumption co-movements, no departure from uncovered interest parity (UIP) and procyclical trade balance, assuming HIB makes the model consistent with the data by producing low consumption correlation, solving the quantity puzzle, generating endogenous departures from the UIP and matching a countercyclical trade balance. The mechanism is empirically validated and shown to be robust to the extent of frictions in the economy.

International audience; We are developing a matching model that reproduces the impact of the sanitary restrictions induced by the Covid-19 crisis on French unemployment, taking into account its heterogenous impacts between various educational levels. We identify the size of the restrictions on sales for each labor market segment and the different use of short-time working program. Our results are obtained thanks to an original matching model integrating (i) time-varying microeconomic risks, (ii) and congestion externalities making unit costs of vacancy posting varying. Afterwards, (i) we evaluate the impact of the short-time working program on unemployment rates by diploma, (ii) we compare different scenarios of the lockdown (short but strict vs long but flexible) and (iii) we forecast the impact of a similar lockdown of March 2020 at the end of March 2021.; Nous développons un modèle d’appariement qui reproduit l’impact de la chronique non-anticipée des restrictions liées à la crise de la Covid-19 sur le chômage français, en tenant compte de l’hétérogénéité entre les différents niveaux d’éducation. Nous identifions l’ampleur des restrictions sur les ventes de chaque segment du marché du travail, ainsi que le recours différencié aux mesures de chômage partiel. Nos résultats sont obtenus grâce à un modèle d’appariement original intégrant à la fois (i) des risques microéconomiques variant dans le temps et (ii) des externalités de congestion faisant varier les coûts unitaires de recrutement. Ensuite, (i) nous évaluons l’impact des mesures de chômage partiel sur les taux de chômage par diplôme, (ii) nous comparons différents scénarios de confinement (court mais strict versus long mais souple), et (iii) nous prévoyons l’impact d’un troisième confinement de Mars à avril 2021.

We study the impact of local immigration inflows on natives’ wages using a large French administrative panel from 1976 to 2007. We show that local immigration inflows are followed by reallocations of blue-collar natives across commuting zones. Because these reallocations vary with the initial occupation, and blue-collar location movers have wages below the blue-collar average, controlling for changes in local composition is crucial to assess how wages adjust to immigration. Immigration temporarily lowers the wages of blue-collar workers, with unskilled workers experiencing larger losses. Location movers lose more than stayers in terms of daily wages but move to locations with cheaper housing.

International audience; This contribution1 introduces a sectoral supply functions approach of equilibrium dynamics in the context of a simple model of overlapping generations with heterogeneous goods. The class of preferences that is here considered hinges upon an endogenous leisure motive and an elementary savings behaviour, that comes as a simpler alternative to the Diamond tradition in the benchmark contributions about the properties of overlapping generations economies with two industries. The presence of some institution making possible intergenerational transfers is shown to influence both the equilibrium aggregate factors shares and elasticity of substitution along a stationary equilibrium. Both Wealth-to-Capital and Golden Rule steady state equilibria being considered, the economies are categorised, either as Samuelsonian or classical, according to the sign of the transfers between generations at the Golden Rule steady state. The local stability properties of the various types of equilibria are successively investigated, the elasticities of substitution between the two inputs being emphasised to play a key-role for that purpose. Interestingly, the smoothing properties of factors substitution and their respective contribution to the obtention of the local uniqueness property may differ between the Samuelsonian and classical economies.

This article considers an inter-temporal optimization problem in a fairly general form and give sufficient conditions ensuring the convergence to infinity of the economy. These conditions are easy to verify and can be applied for a large class of problems in literature. As examples, some applications for different economies are also given.

International audience; This article considers a two-sector economy with externalities. In particular, the analysis involves an industrial sector whose polluting production activities have negative effects on the regeneration of a natural resource in the other sector. Without convexity or supermodularity, we prove that the economy evolves to increase the net gain of stock (a similar notion to the net gain of investment in Kamihigashi and Roy (2007)), and establish the conditions ensuring the convergence of the economy in the long run.

We document how differences in labour demand by gender explain the contrasting evolutions of labour force participation between men and women during the Great Recession in Europe. We first highlight that Europe is characterized by high levels of occupational segregation by gender. As a result, the large job losses in middle-paid occupations during the Great Recession affected male workers disproportionally. In contrast, the fact that higher- and lower-paid occupations were less affected was more favourable to women. Using individual panel data, we investigate how the labour force participation and regional mobility of men and women responded to these shocks. We find that the labour force participation of women increased considerably in the regions most affected by the destruction of men's jobs and with relatively higher labour demand in occupations more likely to employ women. Women with higher levels of education were also more likely to move to regions with higher labour demand in these occupations. We find that not considering the mobility of women with higher education levels can bias the estimates of the impact of labour demand shocks on participation. For men, unemployment increased in response to regional declines in male labour demand. However, regional shocks explain none of the decline in male labour force participation.

We study optimal fiscal policy in an economy plunged into a deep recession characterized by a liquidity trap, and in which the government can allocate spending both to consumption and investment goods. Public investment increases the stock of public capital subject to a time-to-build constraint. The zero lower bound on the nominal interest rate binds as a result of a large shock that increases households’ desire to save in the risk-free asset, pushing the natural rate of interest below zero. Under nominal rigidities and sub-optimal monetary policy, the shock leads to a large decline in private consumption and investment. We show that the optimal response to such a shock is to temporarily raise public spending above the level that would be dictated by classical principles, and to tilt its composition towards public investment. This compositional shift lasts well after the natural rate has ceased to be negative. Our results suggest that the American Recovery and Reinvestment Act of 2009 was insufficiently oriented towards public investment.

International audience; The recent COVID-19 crisis has revealed the urgent need to study the impact of an infectious disease on market economies and provide adequate policy recommendations. The present paper studies the optimal lockdown policy in a dynamic general equilibrium model where households are altruistic and they care about the share of infected individuals. The spread of the disease is modeled here using SIS dynamics, which implies that recovery does not confer immunity. To avoid non-convexity issues, we assume that the lockdown is constant in time. This strong assumption allows us to provide analytical solutions. We find that the zero lockdown is efficient when agents do not care about the share of infected, while a positive lockdown is recommended beyond a critical level of altruism. Moreover, the lockdown intensity increases in the degree of altruism. Our robust analytical results are illustrated by numerical simulations, which show, in particular, that the optimal lockdown never trespasses 60% and that eradication is not always optimal.

International audience; We introduce an infinite-horizon endogenous growth framework for studying the effects of foreign aid on the economic growth in a recipient country. Aid is used to partially finance the recipient’s public investment. We point out that the same rule of aid may have very different outcomes, depending on the recipient’s circumstances in terms of development level, domestic investment, efficiency in the use of aid and in public investment, etc. Foreign aid may promote growth in the recipient country, but the global dynamics of equilibrium are complex (because of the non-monotonicity and steady state multiplicity). The economy may converge to a steady state or grow without bounds. Moreover, there are rooms for the divergence and a two-period cycle. We characterize conditions under which each scenario takes place. Our analysis contributes to the debate on the nexus between aid and economic growth and in particular on the conditionality of aid effects.

International audience; We consider a model with a finite number of states of nature where short sells are allowed. We present a notion of no-arbitrage price weaker than the one of Werner (1987) that we call weak no-arbitrage price. We prove that in the case of maximin expected utility functions, the existence of one common weak no-arbitrage price is equivalent to the existence of an equilibrium. © 2018 Elsevier B.V.

International audience; This article establishes a dynamic programming argument for a maximin optimization problem where the agent completes a minimization over a set of discount rates. Even though the consideration of a maximin criterion results in a program that is not convex and not stationary over time, it is proved that a careful reference to extended dynamic programming principles and a maxmin functional equation however allows for circumventing these difficulties and recovering an optimal sequence that is time consistent.

International audience; We provide necessary and sufficient conditions to detect local bifurcations of three and four-dimensional dynamical systems in continuous time. We characterize not only the bifurcations of codimension one but also those of codimension two. For the sake of completeness, we give also the non-degeneracy conditions for each bifurcation. The added value of our methodology rests on its generality. To illustrate the tractability of our approach, we provide two analytical applications of dimension three and four to environmental economics, complemented with numerical simulations. (C) 2018 Elsevier B.V. All rights reserved.

International audience; Life expectancy is on the rise across the world. This paper analytically studies how it affects welfare in general equilibrium. First, we examine the exogenous impact of a longevity increase on welfare in a canonical Diamond model. We find that a longevity increase does not necessarily increase welfare. Second, we study the impact of a longevity increase on welfare when longevity improvements are costly. We show the existence of economies in which welfare is maximized when longevity is at its minimal level. We provide numerical illustrations of our results. They highlight that the age at which longevity improves and the cost of such improvements are important to determine the welfare impact of a longevity increase.

This article builds an axiomatization of inter-temporal trade-offs that makes an explicit account of the distant future and therefore encompasses motives related to sustainability, transmission to offsprings and altruism. The focus is on separable representations and the approach is completed following a decision-theory index based approach that is applied to utility streams. This enlightens the limits of the commonly used tail intensity requesites for the evaluation of utility streams: in this article, these are supersed and replaced by an axiomatic approach to optimal myopia degrees that in its turn precedes the determination of optimal discount. The overall approach is anchored in the new and explicit proof of a temporal decomposition of the preference orders between the distant future and the close future itself directly related to the determination of the optimal myopia degrees. The argument is shown to provide a novel understanding of temporal biases with the scope for a distant future bias when the finite dimensional gets influenced by the infinite dimensional.The reference to robust orders and pessimism-like axioms finally allows for determining tractable representations for the indexes.

International audience; We consider an overlapping generations model a la Diamond (1965) with two additional ingredients: altruism and an asset (or land) bringing non-stationary positive dividends (or fruits). We study the global dynamics of capital stocks and asset values as well as the interplay between them. Asset price bubbles are also investigated. (C) 2018 Elsevier B.V. All rights reserved.

We build a dynamic general equilibrium model with heterogenous producers and financial market imperfections (collateral constraints and incompleteness). First, we prove the existence of equilibrium and provide a tractable characterization to check whether a sequence is an equilibrium. Second, we study the effects of financial imperfections on economic growth and land prices. Third, we develop a theory of valuation of land by introducing the notion of endogenous land dividends (or yields) and different concepts of land-price bubbles. Some examples of bubbles are provided in economies with and without short-sales.

International audience; Since Heal (Explorations in natural resource economics. The Johns Hopkins University Press for Resources for the Future, Baltimore, 1982), there is a theoretical consensus about the occurrence of limit cycles (through a Hopf bifurcation) under a positive effect of pollution on consumption demand (compensation effect) and about the impossibility under a negative effect (distaste effect). However, recent empirical evidence advocates for the relevance of distaste effects. Our paper challenges the conventional view on the theoretical ground and reconciles theory and evidence. The environmental Kuznets curve (EKC) (pollution first increases in the capital level then decreases) plays the main role. Indeed, the standard case à la Heal (limit cycles only under a compensation effect) only works along the upward-sloping branch of the curve while the opposite (limit cycles only under a distaste effect) holds along the downward-sloping branch. Welfare effects of taxation also change according to the slope of the EKC.

We consider a model with a countably infinite number of states of nature. The agents have equivalent probability beliefs and von Neumann–Morgenstern utilities. The No-Arbitrage Prices in this paper are, up to a scalar, the marginal utilities. We introduce the Beliefs Strong Equivalence and the No Half Line Condition of the same type conditions. Under these conditions, the No Arbitrage price condition is sufficient for the existence of an equilibrium when the commodity space is l p , 1 ≤ p + ∞ . This No Arbitrage condition is necessary and sufficient for the existence of equilibrium when the total endowment is in l ∞ . Moreover, it is equivalent to the compactness of the individually rational utility set.

International audience; The goal of this paper is to determine the exchange rates consistent with an equilibrium in the international assets and goods markets. We present a wealth model of a two-country economy where financial assets and goods are traded. We consider the case where the agents are risk neutral, a very common assumption in finance in order to have explicit solutions for prices, and, in particular, in international finance for exchange rates using the non-null Pareto optima. We show that the Pareto optima in the international assets and goods markets are found to coincide with the net trade allocations. More notably, under a no-arbitrage condition in the assets markets, we can define an exchange rates system for which PPP holds. We provide conditions to have a non-null Pareto optimum to compute the exchange rates. We give an example with a non-null Pareto optimum associated with the determination of the exchange rate. © 2017 Elsevier B.V.

We consider a multi-sector infinite-horizon general equilibrium model. Asset supply is endogenous. The issues of equilibrium existence, efficiency, and bubble emergence are addressed. We show how different assets give rise to very different rational bubbles. We also point out that efficient bubbly equilibria may exist.

We study the optimal dynamics of an AK economy where population is uniformly distributed along the unit circle. Locations only differ in initial capital endowments. Spatio-temporal capital dynamics are described by a parabolic partial differential equation. The application of the maximum principle leads to necessary but non-sufficient first-order conditions. Thanks to the linearity of the production technology and the special spatial setting considered, the value-fonction of the problem is found explicitly, and the (unique) optimal control is identified in feedback form. Despite constant returns to capital, we prove that the spatio-temporal dynamics, induced by the willingness of the planner to give the same (detrended) consumption over space and time, lead to convergence in the level of capital across locations in the long-run., Nous étudions la dynamique optimale d'une économie Ak dans laquelle la population est distribuée uniformément le long du cercle unité. Les lieux ne diffèrent que par leur dotation initiale de capital. La dynamique du capital est décrite par une équation aux dérivées partielles dans l'espace et le temps. Grâce à la linéarité de la technologie de production et le cadre spatial, nous trouvons la fonction de valeur d'une façon explicite et identifions le contrôle optimal qui est par ailleurs unique. Malgré les rendements d'échelle constants, nous démontrons que la dynamique dans le temps et l'espace, induite par la volonté du décideur de donner le même niveau de consommation à travers le temps et l'espace, mène à la convergence spatiale du capital à long terme.

International audience; The macroeconomic sustainability of public debt is addressed when the interaction between fiscal and monetary policies is taken into account, as well as the possibility of default. Taking into account a rule of default, we distinguish the "default threshold" from the "unsustainability threshold". The former one corresponds to the upper limit to public debt ; the latter one to the level above which, absent any further shock, the dynamics of public debt leads to future default. When this threshold is exceeded, the risk premium is high enough so as to generate future default, which itself feeds the risk premium. When a default occurs, the haircut applied on the existing amount of debt depends on the default rule. We show that a "successful default" is such that the ex post debt level is sustainable, which means that the ex post default risk premium is small enough and thus leads to a decreasing debt to GDP ratio. This implies that the haircut on public debt must be high enough.; Nous étudions la question de la soutenabilité de la dette publique dans le cadre d'un modèle macroéconomique prenant explicitement en compte l'interaction des politiques monétaire et budgétaire ainsi que la possibilité de défaut sur la dette publique. Nous différencions la notion de " seuil de défaut " de celle de " seuil d'insoutenabilité ". Le seuil de défaut correspond à la limite d'endettement de l'État. Le défaut survient lorsque le marché ne reconnaît plus à l'État la capacité d'honorer la totalité de sa dette. Le " seuil d'insoutenabilité " peut être atteint pour des niveaux de dette plus faibles. Le marché continue à affecter une probabilité positive au remboursement complet de la dette. Pour autant, lorsque ce seuil est dépassé, la prime de risque réclamée par le marché pèse si lourdement sur les comptes publics que le défaut devient, en l'absence de choc macroéconomique favorable, inévitable. Nous montrons également qu'un " défaut réussi " nécessite une règle de défaut respectant le critère de soutenabilité de la dette après défaut, la soutenabilité signifiant ici que la prime de risque après défaut doit être suffisamment faible pour assurer que la part de la dette dans le PIB puisse continuer à décroître. Une règle de défaut efficiente doit impliquer une réduction suffisante de la dette publique.

International audience; This paper considers rational land and housing bubbles in an infinite-horizon general equilibrium model. Their demands rest on two different grounds: the land is an input to produce while the house may be consumed. Our work differs from the existing literature in two respects. First, dividends on both these long-lived assets are endogenous and their sequences are computed. Second, we introduce and study different concepts of bubbles, including individual and strong bubbles.

This paper aims at clarifying the analytical conditions under which financial globalization originates welfare gains in a simple endogenous growth setting. We focus on an open-economy $$\textit{AK}$$ model in which the capital-deepening effect of financial globalization boosts growth in a in permanent but entails an entry cost in order to access international credit markets. We show that constrained borrowing triggers substantial welfare gains, even at small levels of international financial integration, provided that the autarkic growth rate is larger than the world interest rate. Such conditional welfare benefits boosted by stronger growth—long-run gain—arise in our preferred model without investment commitment and they range, relative to autarky, from about $$2\%$$ in middle-income countries to about $$13\%$$ in OECD-type countries under international financial integration. Sizeable benefits emerge despite the fact that consumption initially falls—short-run pain—which is, however, shown not to dwarf positive growth changes.

International audience; We study the interplay between taxation, bubble formation and economic growth. A rational bubble may be beneficial when growth is fueled by public investment (or R&D externalities) and the government levies taxes on bubble returns to finance this investment. Our main result challenges the conventional view about the negative effect of bubbles in endogenous growth (Grossman and Yanagawa, 1993). © 2016 Elsevier B.V.

International audience; We investigate the effects of collateral and monetary policy on economic growth within a Ramsey equilibrium model where agents have different discount factors. Introducing liquidity constraints in segmented markets where (poor) impatient agents without collateral have limited access to credit, we study their implications in terms of welfare and business cycles (based on deterministic cycles through bifurcations and self-fulfilling prophecies). We find that an accommodative monetary policy may be growth-enhancing and welfare-improving (through the inequality reduction) while making unpleasant fluctuations more likely. Conversely, a regulation reinforcing the role of collateral and tempering the financial market imperfections may stimulate the economic growth while pursuing the goal of stabilization. © 2016 Elsevier Inc.

International audience; We consider a model with an infinite number of states of nature, von Neumann–Morgenstern utilities, where agents have different probability beliefs and where short sells are allowed. We show that no-arbitrage conditions, defined for finite dimensional asset markets models, are not sufficient to ensure existence of equilibrium in presence of an infinite number of states of nature. However, if the individually rational utility set U is compact, we obtain an equilibrium. We give conditions which imply the compactness of U. We give examples of non-existence of equilibrium when these conditions do not hold.

International audience; We build an infinite-horizon dynamic deterministic general equilibrium model with imperfect markets (borrowing constraints), in which heterogeneous agents invest in capital or/and financial asset and consume. There is a representative firm which maximizes its profit. Firstly, the existence of intertemporal equilibrium is proved even if aggregate capital is not uniformly bounded. Secondly, we study the interaction between the financial market and the productive sector. We also explore the nature of physical capital bubble and financial asset bubble as well.

International audience; We transpose the Generalized Impulse-Response Function (GIRF) developed by. Koop etal. (1996) to Markov-Switching structural VARs. As the algorithm displays an exponentially increasing complexity as regards the prediction horizon, we use the collapsing technique to easily obtain simulated trajectories (shocked or not), even for the most general representations. Our approach encompasses the existing IRFs proposed in the literature and is illustrated with an applied example on gross job flows. © 2012 Elsevier B.V.

International audience; Ehrmann et al. (2003) proposed an IRF in the frame of Markov-switching structural VARs. Their IRF provides insights on the dynamics within the regime in which the shock occurs. We propose an IRF that captures the global response of the system and illustrate its use with examples.

This paper characterizes optimal non-linear income taxation in an economy with a continuum of unobservable productivity levels and endogenous involuntary unemployment due to frictions in the labour markets. Redistributive taxation distorts labour demand and wages. Compared to their efficient values, gross wages, unemployment, and participation are lower. Average tax rates are increasing. Marginal tax rates are positive, even at the top. Finally, numerical simulations suggest that redistribution is much more important in our setting than in a comparable Mirrlees-type setting. Copyright 2006, Wiley-Blackwell.

International audience; This paper provides a simple general equilibrium analysis of privatization, exploring its real effects. They derive from the expansion of risk-sharing opportunities (within an incomplete markets setting) that are created by the addition of a market in the public project property rights. The principal conclusion is that an optimal combination of voucher and share issue privatization can implement the first-best. © 2005 Blackwell Publishing, Inc.

International audience; This study examines the set of interdependences between the formation of wages, prices and the minimum wage (SMIC) through a vectorial error correction model estimated on French quarterly macroeconomic data covering the 1970-1/1999-4 period. Two periods are distinguished: the period of inflation rise from 1970 to 1981, which coincides with an important squeeze of the wage range, measured by the ratio of the minimum wage to the hourly wage rate; the period of disinflation since 1981, that has been concomitant with a stability of wage inequalities. Disinflation has hardly benefited the evolution of the SMIC which has always profited by price rises, in real and relative terms, which have become less strong. This evolution does not benefit any more on wage rises, when the interdependences between variables are taken into account. The SMIC seems however to have gained in efficiency as an instrument on wage disparity reduction. It rises are finally more persistent in real terms and relatively to the other salaries and have always as little inflationary impact on wages as on prices. © 2004 Taylor and Francis Ltd.

International audience; The `Brainard conservatism principle' states that the optimal monetary policy rule should be less aggressive when uncertainty about parameters is taken into account. However, this principle is not fully general and may be reversed in some cases. This paper examines the implications of parameter uncertainty for monetary policy using a simple empirical model of the Euro area. The Brainard principle is found to be empirically relevant.

The paper provides a continuous time version of the well known discrete time Mitra-Wan model of optimal forest management, where a forest is harvested to maximize the utility of timber flow over an infinite time horizon. Besides varying with time, the state variable (describing available trees) and the other parameters of the problem vary continuously also with respect to the age of the trees. The evolution of the system is given in terms of a partial differential equation and later rephrased as an ordinary differential equation in an infinite dimensional space. The paper provides a classification of the behavior of optimal and maximal programs when the utility function is linear, convex, or strictly convex and the discount rate is positive or null. Formulas are provided for modified golden-rule configurations (uniform density functions with cutting at the ages that solve a Faustmann problem) and for Faustmann policies, and the optimality or maximality of such programs is discussed. In all different sets of data, it is shown that the optimal (or maximal) control is necessarily something more general than a function, i.e. a positive measure. In particular, in the case of strictly concave utility and null discount, when the Faustmann policy is not optimal, it is shown that optimal paths converges over time to the golden rule configuration, while in the case of strictly concave utility and positive discount the Faustmann policy is shown to be not optimal, contradicting the corresponding result in discrete time.

Ce working paper a fait l'objet d'une publication in Economics Letters, 122(2):303-307, 2014; We consider a small-open, collateral-constrained AK economy. We show that the combination of CARA preferences and uncertainty on capital inflows in such an economy generates long-term (expected) growth while the deterministic counterpart does not. In this framework, long-term growth is entirely driven by precautionary savings. In particular, we show that the asymptotic growth rate of the expected capital stock is an increasing function of both the risk parameter and the Arrow-Prat absolute risk aversion parameter. The model also predicts that economies that are more financially integrated through international borrowing experience lower consumption growth volatility relative to output growth volatility.

International audience; We study the effectiveness of public investment in stimulating an economy stuck in a liquidity trap. We do so in the context of a tractable new-Keynesian economy in which a fraction of government spending increases the stock of public capital subject to a time-to-build constraint. Public investment projects typically entail significant time-to-build delays, which often span several years from approval to completion. We show that this feature implies that the spending multiplier associated with public investment can be substantially large — nearly twice as large as the multiplier associated with public consumption — in a liquidity trap. Intuitively, when the time to build is sufficiently long, and to the extent that public capital raises the marginal productivity of private inputs, the resulting disinflationary effect will occur after the economy has escaped from the liquidity trap. At the same time, the increase in households' expected wealth amplifies aggregate demand while the economy is still in the liquidity trap. Using a medium-scale model extended to allow for the accumulation of public capital, we quantify the multiplier associated with the spending component of the 2009's ARRA, which allocated roughly 40% of the authorized funds to public investment. We find a peak multiplier of 2.31. Our results also indicate that failing to account for the composition of the stimulus by overlooking its investment component would lead one to underestimate the spending multiplier by about 50%. © 2016 Elsevier Inc.

International audience; In this paper, we consider an OG model with endogenous fertility and pollution externalities. We assume that pollution lowers the productivity. In the long run, under dominant income (substitution) effects, a raise in the cost of rearing children, increases (decreases) consumption and decreases (increases) pollution. In the short run, under dominant income effects, a sufficiently low pollution elasticity of labor productivity promotes deterministic cycles through a Hopf bifurcation jointly with expectations-driven fluctuations. © 2013 University of Venice.

ACL-2; International audience; Parfit’s Repugnant Conclusion stipulates that under total utilitarianism, it might be optimal to choose increasing population size while consumption per capita goes to zero. We evaluate this claim within a canonical AK model with endogenous population size and a reduced form relationship between demographic and economic growth. First we characterize the optimal solution paths for any capital dilution function. Second, we prove that while the Repugnant Conclusion can never occur for realistic values of intertemporal substitution in the traditional linear dilution model, it does occur when population growth is linked to economic growth via an inverted U-shaped relationship. Copyright Springer-Verlag 2013

We study the existence of equilibrium and rational bubbles in a Ramsey model with heterogeneous agents, borrowing constraints and endogenous labor. Applying a Kakutani's fixed-point theorem, we prove the existence of equilibrium in a time-truncated bounded economy. A common argument shows this solution to be an equilibrium for any unbounded economy with the same fundamentals. Taking the limit of a sequence of truncated economies, we eventually obtain the existence of equilibrium in the Ramsey model. In the second part of the paper, we address the issue of rational bubbles and we prove that they never occur in a productive economy à la Ramsey., Dans ce papier, nous étudions le problème d'existence d'équilibres et de bulles rationnelles dans un modèle de Ramsey avec agents hétérogènes, contraintes d'emprunt et travail endogène. Nous démontrons d'abord l'existence d'un équilibre dans une économie avec un nombre fini de périodes en utilisant le théorème de point fixe de Kakutani. Ensuite, nous faisons tendre le nombre de périodes vers l'infini pour obtenir un équilibre pour un nombre infini de périodes. Dans la deuxième partie du papier, nous montrons que les bulles n'émergent pas dans cette économie à la Ramsey.

International audience; We characterize optimal redistributive taxation when individuals are heterogeneous in their skills and their values of non-market activities. Search-matching frictions on the labor markets create unemployment. Wages, labor demand and participation are endogenous. Average tax rates are increasing at the optimum. This shifts wages below their laissez faire value and distorts labor demand upwards. The marginal tax rate is positive at the top of the skill distribution even when the latter is bounded. These results are analytically shown under a Maximin objective when the elasticity of participation is decreasing in the skill level and are numerically confirmed under a more general objective. Under the Maximin, above approximately 20,000 per year, our model recommends higher marginal tax rates than a comparable competitive setting. © 2011 Elsevier B.V.

International audience; In this paper, we study the effects of collaterals on business cycles and growth in monetary economies with credit market imperfections. We consider an endogenous growth model with a partial cash-in-advance constraint. It is assumed that the share of consumption purchases paid on credit depends positively on the collaterals available to the agent. In this case, money is no longer superneutral. We find that, under mild inflation rates, a higher money growth rate is welfare-improving and, surprisingly, it makes the occurrence of expectations-driven fluctuations less likely. The shape of credit share in consumption purchases, as outcome of regulatory policies, has an impact on both welfare and stability. In particular, the higher the sensitivity of the credit share to collaterals, the more stable the economy under rational expectations. These analytical findings are complemented by economic interpretations. © 2010 University of Venice.

We estimate an ordered probit model in order to explain the occurrence and magnitude of producer price changes in the French manufacturing sector. We use data consisting essentially of the Banque de France monthly business surveys, pooled over the years 1998-2005. Our results show that changes in the price of intermediate inputs are the main driver of producer price changes. Firms also appear to react significantly to changes in the producer price index of their industry. Variations in labor costs as well as in the production level also appear to increase the likelihood of a price change but their influence seems to be of a lesser importance. We also show that estimating an unconstrained dynamic model allows improving the estimation results as compared to those associated with a standard state-dependent model. Finally, our results point to an asymmetry in price adjustments. When they face a change in their costs, firms adjust their prices upward more often and more rapidly than they do it downward. JEL Classification: C23, C25, E31

International audience; We consider an optimal nonlinear income tax problem in a model with search-matching unemployment and where the negotiated pre-tax wage decreases with marginal tax rate but increases with the level of tax. By omitting labor supply Responses, assuming no benefit for the unemployed and an efficient allocation in the absence of tax, we characterize the optimal equity-efficiency trade off. We show that in labor market specific to each interior level of skill, optimal wages and unemployment rates are distorted downwards. Moreover, average tax rate are increasing along the income distribution and marginal tax rate are positive at the top, even when the skill distribution is bonded.; Dans cet article, nous nous intéressons à la détermination d’un barème fiscal non-linéaire optimal dans un modèle où des frictions de recherche engendrent du chômage et où les salaires négociés diminuent avec les taux marginaux et augmentent avec les niveaux de taxes. En négligeant les réponses de l’offre de travail, en supposant l’absence d’allocation pour les chômeurs et en supposant que l’allocation des ressources est efficace en l’absence de taxes, nous sommes à même de proposer le meilleur compromis entre équité et efficacité. Nous montrons que pour chaque marché du travail correspondant à un niveau de productivité intérieur, la redistribution optimale s’accompagne d’une distorsion des salaires et des taux de chômage vers le bas. Nous montrons également que le barème fiscal optimal se caractérise par des taux moyens de taxation qui augmentent avec les salaires et que le taux marginal de taxation en haut est toujours positif, même en présence d’une distribution bornée.

International audience; The paper proposes an original strategy for analyzing household sharing of income and satisfaction. Using two different subjective questions from the Russian data RLMS (Russia Longitudinal Monitoring Survey), we assume a correspondence between, first, the perception of income that household members report and their true income sharing, and, second, between their answer to a satisfaction question and their utility. We show that answers given by different members of the household bring pertinent information on income sharing and utility in the household. In particular, we find a significant effect of the female-male wage ratio in reported income perception and satisfaction differentials between household members. Given that the available data covers the transition period (1994-2003) characterized by massive economic and social changes in Russia, we investigate the dynamics of household behavior.

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International audience; The present paper deals with the management of environmental quality at the level of a city. More precisely, we propose two different contractualisms among citizens that allow them to reduce the polluting emissions caused by their consumption of both a private and a collective good. In the first contractualism, the mayor proposes to citizens to establish neighbourhood committees. They have the responsibility of defining the total amount of polluting emission by private and public transportation means in their neighbourhood. It comes out that the mediation of the neighbourhood committees brings out a lower total pollution than in the case where each individual citizen acts on his own interest. However the emission level brought out by the neighbourhood committees is not Pareto-optimal. On the other hand, extending the first coalitional game by a supplementary stage focused on bargaining between the neighbourhood committees, allows us to define a participative democracy procedure. This two-stage procedure brings about a Pareto-optimal pollution level. © 2008 Elsevier B.V. All rights reserved.

International audience; In this paper, we present a new methodology for modelling intraday volume, which allows for a reduction of the execution risk in VWAP (Volume Weighted Average Price) orders. The results are obtained for all the stocks included in the CAC40 index at the beginning of September 2004. The idea of considered models is based on the decomposition of traded volume into two parts: one reflects volume changes due to market evolution; the second describes the stock specific volume pattern. The dynamic of the specific volume part is depicted by ARMA and SETAR models. The implementation of VWAP strategies allows some dynamic adjustments during the day in order to improve tracking of the end-of-day VWAP. © 2007 Elsevier B.V. All rights reserved.

International audience; It is argued that the tax on continued activity should be removed by implementing actuariallyfair schemes. However, these schemes cannot fund the expected Social Security deficit. This paper proposes to give individuals a fraction of the actuarially-fair incentives in the case of postponed retirement. Social Security faces a trade-off between giving enough incentives to make individualselay retirement and giving little increase in pensions in order to help finance its expected deficit. This trade-off is captured by a Laffer curve. Finally, when the Social Security system aims to maximize welfare, the optimal tax on postponed retirement is still strictly positive.