OECD Economic Surveys: France - Volume 2003 Issue 11 (OECD Economic Surveys)

Table of contents......Page 5
Basic statistics of France......Page 8
Assessment and recommendations......Page 10
Growth has been slow in 2002 and early 2003......Page 24
Figure 1. Recent economic trends......Page 25
Table 1. Quarterly gross domestic product......Page 26
Figure 2. Reduced supply-side tensions......Page 27
Inflation and labour market tensions have eased......Page 28
Figure 3. Business sector indicators......Page 29
Figure 4. Price developments......Page 30
Figure 5. Wages, labour costs and competitiveness......Page 32
Figure 6. Employment and unemployment......Page 33
Macroeconomic policy was relaxed......Page 34
Figure 8. Monetary conditions......Page 35
Table 2. General government accounts......Page 37
Box 1. Recent measures affecting taxes......Page 39
The short-term outlook......Page 38
Fiscal policy in 2003 and 2004......Page 40
The challenge of ageing to long-term fiscal sustainability......Page 41
Figure 9. Long-term debt dynamics......Page 42
Box 2. The government’s proposed pension reform......Page 44
Improving potential output could improve prospects......Page 43
Figure 10. Employment rates......Page 45
Substantial spending cuts are required......Page 46
Table 3. Fiscal sustainability and structural reform......Page 47
Table 4. Impact of spending reform on fiscal sustainability......Page 49
Action is required soon......Page 48
Low youth employment following 30 years of decline......Page 52
Figure 11. Trends in youth employment......Page 54
Table 5. Employment programmes for youth under 26 years of age......Page 55
Box 3. Evaluating the employment impact of the 35 hours legislation......Page 60
Figure 12. Minimum wages......Page 63
Figure 13. SMIC, take-home pay, labour and employment......Page 64
Figure 14. Harmonising minimum wages and low-wage worker social security reductions......Page 66
Table 6. Expected change in labour costs for minimum-wage workers......Page 67
Making work pay for older workers......Page 69
Figure 15. Older worker employment rates......Page 70
Table 7. Early-retirement schemes and older-worker employment......Page 71
Figure 16. Financial incentives of retirement schemes......Page 72
Policies to promote Research and Development and innovation......Page 75
Box 4. Proposed measures to support the creation, financing and efficiency of small and medium enterprises......Page 76
Tax policy and the attractiveness of “site France”......Page 80
Table 8. Legal corporate income tax rates......Page 82
Table 9. Inflation of name brand versus in-house products......Page 84
Corporate governance and regulation......Page 85
Progress in reducing the role of the state in the business sector......Page 87
Box 5. The State as entrepreneur......Page 88
Some aspects of sustainable development......Page 91
Box 6. Policy integration across sustainable development areas......Page 92
Climate change......Page 93
Table 10. Main indicators: climate change......Page 94
Table 11. Greenhouse gas emissions and sectoral indicators......Page 95
Table 12. Long run marginal costs of power generation......Page 98
Reducing water pollution......Page 99
Figure 17. Water quality of rivers and streams......Page 101
Figure 18. Nitrates in underground aquifers......Page 102
Figure 19. Financial costs of water pollution......Page 103
Summary......Page 104
Table 13. Overview of progress in structural reform......Page 105
Spending in international comparison......Page 112
Figure 20. Public expenditure......Page 113
Table 14. Major current government outlays......Page 115
Figure 21. General government primary expenditure by economic category......Page 117
The challenges ahead......Page 114
Budgetary processes and arrangements across levels of government......Page 118
Table 15. Organisation of the public sector in France......Page 119
Box 7. Fiscal relations between levels of government......Page 120
Figure 22. Expenditure shares by level of government......Page 121
The State budget......Page 122
Table 16. Preparation of the State budget......Page 123
Sub-national governments......Page 125
Social protection......Page 126
Box 8. The social security system......Page 127
Box 9. Special social security financing funds......Page 130
Improving the authorities’ control over expenditure......Page 131
Table 17. Fiscal consolidation in the OECD......Page 132
Figure 23. Slippage in multiyear targets......Page 134
Figure 24. Asymmetric response of expenditures to the economic cycle......Page 135
Box 10. Incomes of the elderly......Page 139
Table 18. Performance indicators: sustainable retirement income......Page 141
Box 11. Main difference between public- and private-sector pension schemes......Page 143
Table 19. Official estimates of pension fund balances......Page 144
Managing fiscal consolidation in the social security system......Page 146
Figure 25. Range of activity of social security schemes......Page 149
Improving the oversight and efficiency of public expenditure......Page 148
Box 12. Decentralisation......Page 153
Summing up......Page 155
Box 13. Summary of recommendations......Page 156
Glossary of acronyms......Page 159
Notes......Page 161
Bibliography......Page 167
Annex I. Long-term fiscal simulations......Page 172
Annex II. Chronologie of main economic events......Page 174