Xavier Jaravel will receive on Monday evening the prize for the best young economist from the Circle of economists and the newspaper Le Monde, awarded each year to a Frenchman aged 40 years or less. A specialist in issues related to innovation, he gave AFP three examples of his work, which tackle macroeconomic questions by exploiting microeconomic data from companies or individuals.
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Xavier Jaravel: “We intuitively think that machines replace humans. But not necessarily. There is also an effect on productivity and a scale effect; you are more competitive thanks to your robot, you increase your quality, you lower your prices and production costs; as a result, you may also need more labor. Companies that automate more have more employment than those that automate less. This is also true jobs that are less well paid And the distribution of wages remains in fact the same in companies that robotize.
When an industry automates more, it preserves its jobs better. Germany, for example, automates and robotizes more than France and for all that it has more industrial jobs. So considering a tax on robots in France could be counterproductive, because the consumer would still buy products made with robots, but abroad. French companies would find it difficult to preserve jobs in the face of their foreign competitors. “
“There is a big disparity depending on social origin but also on the territory of origin. At the same school performance, if your parents are among the 10% highest income, you are ten times more likely to become innovator, for example by getting a patent or starting a startup, versus someone whose parents are below the median income. And being very good at math predisposes you to become an innovator only if you come from a background. family counting among the top 10% of income.This means that there is a talent pool which can be very large to increase innovation but which is not mobilized at all.
On the other hand, people make innovations that are very similar to those to which they were exposed during their childhood. If you work in Boston, on the East Coast, and grew up in Silicon Valley, you’re much more likely to be in tech, whereas someone who grew up in Boston and would have stayed in Boston will be more likely. in medical innovations or biotech.
“In the United States, inflation rates are higher on products that the less well-off social groups buy. So the poor experience higher rates of inflation. You don’t see this effect when using very data. macro, on 15 or 20 sectors, when we look at who buys computers or food products, etc … But when we analyze finer data, we see big differences appear within the sectors, as with organic products, which are bought by the richest and have very low inflation rates or whose prices are falling.
The poorest buy “mass market” products on which inflation rates are higher. If we took this reality into account, there would be (in the statistics) three million more people in poverty in the United States, who would suddenly have access to social assistance devices, such as Medicaid health insurance. .
This phenomenon is explained because in the United States, the markets which are in growth are those of the high-end products bought by the richest. There is therefore an incentive to enter these markets because there are market shares to be taken and we can have a good return on investment.
Often the basic assumption in economics is that if demand increases, prices rise. But if you look a little bit longer, the demand goes up, it creates incentives to re-enter the market and the price can go down – that’s what you see in the data. “
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– Three questions to Xavier Jaravel, winner of the prize for the best young economist 2021
– Xavier Jaravel, prize for the best young economist 2021
– Xavier Jaravel, winner of the Best Young Economist Award 2021