Recent French Export Performance: Is There a Competitiveness Problem?

Author/Editor:

Alain N. Kabundi ; Francisco d Nadal De Simone

Publication Date:

January 1, 2009

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

Recently, the export performance of France relative to its own past and relative to a major trading partner, Germany, deteriorated. That deterioration seems related to the geographical destination and product composition of trend exports. Faced with an increase in unit labor costs or in its terms of trade, France adjusts relatively less via price and wage changes, and more via employment changes. Given that SMIC convergence resulted in a significant increase in unit labor costs, foreign sector difficulties might be structural. Trade flows relevance and euro area policy constraints highlight the importance of structural reforms that increase markets flexibility.

Series:

Working Paper No. 2009/002

Subject:

Export performance Exports Labor costs Supply shocks Terms of trade

English

Publication Date:

January 1, 2009

ISBN/ISSN:

9781451871494/1018-5941

Stock No:

WPIEA2009002

Pages:

73

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