- Pile of hardcover books on table with open book on top
Vivien LEVY-GARBOUA and Gérard MAAREK have co-authored a new book entitled "Impôts, le Grand Désordre" at Presses universitaires de France (PUF) that tackles the question of the French tax system. Description.
The French tax system is in great disarray: it is complex, unstable and levies record high sums. Yet public opinion continues to nurture great expectations: taxes should fight pollution, stimulate employment and research, reduce tobacco consumption, fund the public education and health systems. The list is endless and the success of this fiscal activism is rare. Governments have a hard time gaging taxpayers' reactions, and they often miss their target, all the while wasting public funds in the process. Tax policy is also intended to serve social justice. But to promote equality of opportunity and improve the situation of the poorest, one need not focus obsessively on the wealthiest, “the 1%” - who are here to remain. This work draws up an inventory. How did we get here? What principles can establish a "good tax"? It is also a call for reform and to fight against the “can-do attitude” with respect to the State and taxes, which has become a veritable doxa. Let’s break some taboos.
Translated from the editor's frontpiece.
Vivien LEVY-GARBOU, graduate of the École Polytechnique-Mines and who holds a PhD from Harvard, is a member of the Department’s Associated & Affiliated Faculty.
Gérard MAAREK, graduate of the École Polytechnique-ENSAE, is former Secretary General of INSÉE and heads the Economic Studies division of a major bank.
They previously published together La Dette, le Boom, la Crise (Economica 1985), MacroPsychanalyse, l’économie de l’Inconscient , PUF, 2007 and Capitalisme, Finance, Démocratie (Economica 2014).
- Ossuary of Douamont
Founded and presided by three Nobel Memorial recipients (including Oliver Williamson), the Society for Institutional and Organizational Economics (SIOE) “studies institutions and organisations, largely but not entirely from the perspective of economics”, and meets annually - the Department had the honour of hosting SIOE’s 20th Annual Conference in 2016, under the direction of Sergeï GURIEV).
The 24th edition was hosted by MIT this year, proposing no less than 9 ‘virtual’ sessions in the time of Covid-19 and more than 250 papers! The Oliver Williamson Award is given to the best paper on the full conference program: a sub-group of four members of the Programme Committee shortlists five papers and the winner is chosen among the finalists by vote of the entire Programme Committee.
“To what extent can heroes coordinate and legitimize otherwise strongly-proscribed and potentially repugnant political behavior?”
This is the question that Julia CAGÉ, permanent faculty member, and co-authors Anna DAGORRET (Stanford), Pauline GROSJEAN (University of New South Wales), and Saumitra JHA (Stanford), set out to answer in the paper they presented at SIOE’s Annual Conference this year, entitled Heroes and Villains: The Effects of Combat Heroism on Autocratic Values and Nazi Collaboration in France.
At first glance the question may seem counterintuitive, as the paper underscores: “Almost by definition, heroes engage in pro-social acts, often those deemed patriotic in most societies, making it hard to distinguish heroic legitimization and endorsement of political activities with their inherent social desirability.” Furthermore, it seems difficult to measure: “the emergence of heroes, the networks that they develop and the heroic acts that they perform are often hard to empirically distinguish from the specific contexts that call for their heroism. Further, heroic narratives are also often shaped after the fact by those with specific objectives, making the propagation of heroism itself often endogenous. »
Undeterred, Julia CAGÉ and her co-authors “exploit a natural experiment– the arbitrary rotation of front-line French regiments to service at the pivotal Battle of Verdun during the generalship of Pétain between February and April 1916– on subsequent active Nazi collaboration by individuals from the home municipalities of those regiments during 1940-1945.” Having identified the men who served under Pétain at Verdun, they were able to cross this population with a novel data set containing “unique individual data on more than 97,242 collaborators… from a secret 1945 French intelligence report that had… gone missing and…only recently declassified.”
They were able then to show that “the Pétain-led Vichy regime (1940-44), municipalities that raised troops that served under Pétain at Verdun later housed more collaborators with the Nazis than otherwise similar municipalities.”
The novelty of the question, the data-set, and its implication for future research, warranted Julia Cagé and her co-authors, SIOE’s 2020 Oliver Williamson Best Conference Paper Award, without a doubt.
Julia CAGÉ is an Assistant Professor (tenure track) and Co-director of LIEPP's "Evaluation of Democracy" research group, created in order to reinforce evaluation practices in France used to report on democratic systems that condition implementation of public policies as advanced democracies all face significant political crises and a decline in democratic legitimacy. She is also a CEPR Research Affiliate.
Her research focuses on political economy, industrial organization and economic history. She is particularly interested in media economics, political participation and political attitudes. Her research has been published in a number of peer-reviewed international journals such as The Review of Economic Studies, the American Economic Journal: Applied Economics, the American Economic Journal: Microeconomics, Explorations in Economic History, the Journal of International Economics, and the European Economic Review. She is already the author of several books accessible to the general public: "Saving the Media - Capitalism, Crowdfunding, and Democracy" (Le Seuil, 2015; Harvard University Press, 2016) and "L’information à tout prix" (joint with N. Hervé and M.-L. Viaud, INA Editions, 2017). Her third book « Le prix de la démocratie » was published in 2018 by Fayard (English edition, Harvard University Press, 2020) and won the “Prix Pétrarque de l’Essai” in 2019.
- Ballot counting at a polling station in rural Guinea-Bissau, elections 2014
Better understanding the state of political systems – particularly in developing countries – via methods used by economists does not appear to be commonplace. However, it is an increasingly popular method that provides results which complement those obtained by political scientists. Benjamin Marx, permanent faculty member, has demonstrated their usefulness in research he has conducted in Kenya and Indonesia.
You study political life in developing countries, but with an economist’s approach. Why this choice? What does economics bring to the analysis of phenomena that are usually tackled by political science?
Benjamin Marx – All the research projects I have conducted with this interdisciplinary approach have convinced me of its added value in the study of political phenomena. Several of my projects are collaborations between economists and political scientists. This is the case of a study I conducted on vote buying in Uganda, and of an article on Islamic law institutions and the 1960 land reform in Indonesia, both of which were conducted with US-based researchers.
In this approach, political science brings its conceptual approach, its knowledge of institutional mechanisms (indispensable for understanding electoral phenomena), and its precise knowledge of local contexts. In my work on Africa I have especially drawn on the work of political scientists such as Joel Barkan and Jeffrey Herbst, who have influenced many scholars in both disciplines.
Meanwhile, economics and econometrics bring their methodological tools as well as great rigor to causal inference, which refers to a researcher’s ability to establish a causal relationship between X and Y variables. This type of approach has recently allowed economists to improve our understanding of political phenomena in developing countries.
For example, two Greek economists – Stelios Michalopoulos and Elias Papaioannou – have established the existence of a structural relationship between pre-colonial political institutions and the different levels of economic development observed in sub-Saharan Africa. Other economist-led research has improved our understanding of phenomena at the crossroads of economics and other social sciences, such as corruption.
There is now a fairly broad consensus among development economists around the importance of institutional phenomena in the emergence of longstanding trends in economic development. My thesis supervisor, Daron Acemoglu, has significantly contributed to this research. To study the political economy of developing countries is to attempt to understand the political and institutional phenomena that hinder the eradication of poverty, the improvement of health and education conditions, good governance, etc. It also sparks imagination about potential solutions.
You recently studied voter turnout in Kenya. How did you proceed and what conclusions did you reach?
B.M. – This was a project conducted in collaboration with the Electoral Commission of Kenya in 2013, aiming to promote citizen participation in a difficult institutional context. The previous presidential election in 2007 had led to an upsurge of interethnic violence in the country, leading Kenya to reform its electoral process and to adopt a new Constitution.
The study focused on the evaluation of simple messages transmitted to citizens by SMS, providing basic but essential information on how the electoral process was functioning in this new framework. For example, some messages contained simple reminders about the practicalities of the voting process, while others sought to succinctly explain the role of a parliamentarian.
Using a randomized evaluation, we were able to show that these messages had increased voter turnout, which is a major challenge in a country where more than 20% of the adult population is illiterate. On the other hand, these messages had another, more unexpected effect: in a survey conducted several months after the election, we observed that citizens who received these messages had a lower level of trust in their electoral institutions.
We explain this result by the fact that the messages increased the salience of the election for voters, while they sent potentially ambiguous signals about the transparency and administrative competence of the Commission. Once confronted with the reality of the election and the difficulties observed on the ground, voters were able to interpret the content of these messages in a different way. Our study therefore highlights the benefits of an information campaign of this type, while showing the importance of the content of the messages: any information about a “sensitive” electoral process can give rise to potentially contradictory interpretations, which will affect citizens’ trust in their democratic institutions in the long term.
You have also studied the relationship of Muslim institutions to society and politics in Indonesia, and have highlighted the importance of land reform in this relationship. How do you explain this?
B.M. – This work was part of a more comprehensive research project on the relations between the Indonesian state and Islamic organizations since 1945. Indonesia has approximately 225 million citizens of Muslim faith, making it the largest Muslim country in the world.
In this case, the purpose of this first study was to study the effects of an agrarian reform that was initiated by the Indonesian government in 1960, and that ended in resounding failure. This work revealed the decisive role of Islamic institutions in the failure of this reform. We showed that an institution of Islamic law called waqf (known in French as biens de mainmorte or habous in North Africa) allowed large landowners to eschew the redistribution of their farmland to the poorest peasants. The waqf is an original legal status based on a donation made in perpetuity for the purpose of financing a work of public or religious utility. For example, a landowner can transfer his land in waqf by stipulating that the land will be used to finance an Islamic school. A property benefiting from waqf status cannot be subject to expropriation and its purpose cannot be changed after the deed of foundation. This institution has historically played an important – and probably negative – role in the economic development of certain regions, particularly in the Ottoman Empire.
Under pressure from Islamic organizations, the Indonesian government of the time had accepted the fact that land with waqf status could not be subject to the redistribution law. This legal element greatly contributed to the failure of land reform. Indeed, landowners massively transferred their land to waqf status to escape redistribution. We were able to show that these transfers led to a strengthening of local Islamic institutions, especially in the educational sphere. A large number of Islamic boarding schools (known in Indonesia as pesantren) are financed by waqfs, and many of these institutions play an important role in local political life. We argue that land transfers to waqf status in the 1960s had a lasting effect on support for political Islam. Today, Islamist parties (which remain a minority nationwide) are doing best electorally in the regions that should have been most affected by land redistribution. These regions are also adopting more local laws based on Islamic law (Sharia). Land reform has thus enduringly shaped the trajectory of political Islam in Indonesia, due to the mediating role played by the waqf.
We are currently working on a second study that focuses more specifically on the role of Islamic schools. This article shows how Islamic schools have adapted to the growth of public education since the 1970s. We also study the ideological consequences of the competition between public and Islamic schools.
You have also studied corruption phenomena related to obtaining housing in slums and the issue of slums in general. What have you learned about this topic?
B.M. -My colleagues and I learned a lot over the course of this project. I’ll give you two examples.
First, the fact that slums in developing countries are not areas of lawlessness, as they are often described. Slums have a complex system of informal regulations and a real housing market. In Kibera, Nairobi’s largest slum and one of the largest slums in Africa, 92% of residents pay a monthly rent. This market is dominated by extremely powerful local political actors who have the power to intercede on behalf of landlords or tenants in conflicts over land use.
Second, our work has shown that the fundamental question raised by slums is the question of social mobility. Is life in the slums a springboard to a better life, integrated into the metropolis, with access to public services and better jobs? Or, conversely, are slums “poverty traps”, with residents remaining prisoners of their precarious living conditions from one generation to the next?
Paradoxically, most economists have a very optimistic view of slums: since living standards are generally much higher in urban areas, many people think that slums are a springboard for rural-urban migrants, who get closer to the opportunities offered by the city. In reality, our level of knowledge about these mechanisms is relatively limited. Few longitudinal studies have been carried out to understand whether there is real mobility from the slums to the middle classes and the formal sector. In our study of Kibera, we show that half of the residents live in the slum for more than eight years, and a large number of families have been there for several generations. This may lead to a less optimistic perspective on the phenomenon. To answer these questions, we will need to continue to follow the families who responded to our survey in 2012-13, in order to better understand whether the social mobility of residents of slums such as Kibera is a myth or a reality.
Can your research findings give rise to exchanges with politicians and/or citizens in the studied fields, particularly to consider solutions?
B.M. – Of course! All this research is meant to help governments, civil society, and citizens to better understand how to improve the governance and transparency of their institutions, how to promote political participation, and so on. Several of the aforementioned studies were carried out in consultation with local actors. For example, the study conducted in Uganda aimed to assess the impact of an information campaign on vote buying conducted by 13 civil society organizations in Uganda. This coalition of NGOs had contacted us in 2015 to create a randomized evaluation of their operations. The study in Kenya was also a collaboration with the government, as I mentioned earlier.
Finally, I have been working for several months on the implementation of a project on decentralization with the government of Indonesia and the World Bank. The purpose of this study is to help 75,000 Indonesian villages better spend the funds they receive from the central government (which have been sharply growing since 2014) by improving governance in the villages. It also aims to train municipalities on issues of public administration and local democracy. This project will allow us to apply what we have learned from other recent studies on decentralization in Indonesia and other emerging countries. These countries are often ahead of us in terms of evaluation policies: in Indonesia, but also in India, South Africa, and Brazil (until recently) there is a real interest in collaborations between governments and researchers to evaluate and better understand the effects of a program or public policy.
Interview by Hélène Naudet, Office of the VP for Research
Translated by Carolyn Avery
The interview was first published in Sciences Po's Cogito Research Magazine, N°11.
Benjamin MARX is Assistant Professor of Economics at the Department since 2018. He is also a CEPR Research Affiliate and AALIMS Faculty Fellow.
His research interests are in political economy and development. His work explores issues related to institutions, accountability, and voting behavior in developing countries, with the goal of understanding how institutions and incentives shape economic and political outcomes. His recent research has focused on Indonesia, Kenya, Senegal, and Uganda.
- Abstract image of the impact of covid-19 on the economy
Sciences Po, in cooperation with the Centre for Economic Policy Research (CEPR), is pleased to announce that it will be co-organising an exceptional conference with the Banca d’Italia and the Banque de France, on the theme “Firms in Times of the Pandemic”.
The conference will take place in Paris, December 4th, 2020.
- Federico CINGANO (Banca d’Italia),
- Stéphane GUIBAUD (Sciences Po),
- Francesca LOTTI (Banca d’Italia),
- Thierry MAYER (Sciences Po),
- Jean-Stéphane MÉSONNIER (Banque de France),
- Frédérique SAVIGNAC (Banque de France)
We are calling for papers ! Interested authors should submit a detailed extended abstract or, preferably, a complete paper in PDF format to: firstname.lastname@example.org
DEADLINE: August 23rd, 2020.
*Decisions of acceptance by the program committee will be announced by mid-September.
- Paper in a typewriter on which it is written "New Research"
First time presentations can be daunting - come join us to warmly support our first year PhD Candidates !
In this time of Covid-19, the Department is dedicating June 30th to our PhD students on zoom.
Our first year students will have the opportunity to present their work for the first time to their peers and faculty members:
- 10.30 Ségal LE GUERN HERRY (advisor: Jean-Marc ROBIN): Economie de la fiscalité
- 11.00 Gustave KENEDI (advisor: Pierre-Philippe COMBES): Intergenerational Social Mobility: Measurement, Mechanisms and Policy
- 11.30 Samuel DELPEUCH (advisor: Thierry MAYER): Macroeconomic Imbalances and the Rise of Protectionism
- 12.00 Victor SAINT-JEAN (advisor: Stéphane GUIBAUD): Does Dark Trading Alter Liquidity? Evidence from European Regulation
12.30 to 14.00 Lunch break
- 14.00 Marco PALLADINO (advisor: Yann ALGAN): Firms, Bargaining and the Gender Wage Gap in France
- 14.30 Clémence LOBUT (advisor: Denis FOUGÈRE): Les effets de l’utilisation du numérique sur les apprentissages des élèves
- 15.00 Daniel GYETVAI (advisor: Pierre CAHUC): The Short-Term Impact of UI Benefits on Wages in the Presence of Nash Wage Bargaining, Renegotiation by Mutual Agreement, and Benefit Endogeneity
When ? JUNE 30th, 2019 - 10.30 to 16.00
Where ? Join on zoom