Axelle Ferrière awarded an ERC Starting Grant

Income and wealth inequality have surged in the Organisation for Economic Co-operation and Development (OECD) economies over recent decades, sparking renewed debates on the optimal tax-and-transfer system. How should governments design redistribution to the poor? Which taxes should be used to finance the safety net?

The answers may ultimately inform the manner in which societies organise themselves to better live together, a subject that has always interested Axelle Ferrière, CNRS Research Professor at Sciences Po.

“My work as a researcher consists of evaluating who the winners and losers of various fiscal reforms are, and of thinking about how to design fiscal policies to maximize the number of households that benefit. However, reforms can rarely benefit the entire population; it is then up to policymakers to make choices.”

To rigorously analyse public policies, Axelle uses a combination of theory, computational modeling, and empirical data. This approach has warranted Axelle the support of the European Research Council (ERC) which awarded her a prestigious Starting Grant for her 5-year project Rethinking the Efficiency-Redistribution Trade-Off: Taxes, Transfers, and Household Inequality (RETTHINQ).

ERC Starting Grants support excellent early-career researchers starting or having recently started their own independent research team or programme.

Axelle’s ERC-funded project proposes to rethink the efficiency-redistribution trade-off through the examination of three dimensions of tax and transfer policy:

• First, it will analyse income-support policies for low-income households, comparing means-tested transfers with schemes that include work requirements. 
• Second, it will study the efficiency costs of capital income taxation to fund redistribution. 
• Third, it will assess the role of consumption taxes as automatic stabilizers, focusing on temporary rate cuts to protect low-income households and support demand during recessions.

Overall, RETTHINQ will combine quantitative models with empirical evidence to inform policies that balance fairness, efficiency, and fiscal sustainability.

It is the 20th project proposed by a researcher at the Department of Economics (CNRS UMR 8259) to receive support from the pan-European funding body for frontier research. Accounting for nearly a third of the total number of ERC projects in economics in France, the Department is second only to the Toulouse School of Economics among 11 hosting institutions.  With Axelle’s new project, the Department currently has eight ongoing ERC projects.

Axelle Ferrière joined the Department of Economics in 2024 as a CNRS Research Fellow and Associate Professor of Economics. Her work lies at the intersection of quantitative macroeconomics and public finance. She studies the effects of fiscal and budgetary policies on wealth distribution and inequality. Using economic models, her research assesses how taxes, social transfers, and public spending influence household behaviour and economic growth.

Her work has been published in international journals such as Review of Economic Studies, American Economic Journal : Macroeconomics and Journal of Monetary Economics. In 2024 she was awarded a CNRS Bronze Medal for her research which uses cutting edge quantitative methods, i.e. computational models, to shed light on the redistributive effects of economic policies.

Prior to joining the Department, she was a Chaired Professor and CNRS Research Fellow at the Paris School of Economics (PSE) and she was an Assistant Professor at the European University Institute (EUI). She holds a PhD in Economics from New York University (NYU), a Master in Economic Analysis and Policy from PSE and a Master in Quantitative Economics and Finance from École Polytechnique (X). 

Congratulations to Axelle Ferrière!