Patrick Artus (pictured), chief economist of the French investment bank Natixis, was on campus to discuss the European economic crisis with students, 7 February. This conference was of particular interest to students as Patrick Artus is a well-known economist in the European, and global, media.
Artus presented his point of view on the crisis showing students data on the evolution of the European economies over the last fifteen years.
Artus’s diagnosis of the crisis is different to conventional views on the matter. Many economists consider the banking and financial crisis as a source of the current economic woes; Artus, on the other hand, believes that it’s the phenomenon of deindustrialisation (which started about fifteen years ago) that is the root of the problem.
The problem caused by deindustrialisation has now been amplified by the banking crisis and the government debt crisis.
(Pictured: Jean-Luc Gaffard, director of the Research on Innovation and Competition Department of the OFCE, with Artus)
Artus presented graphs showing how employment in the manufacturing sectors in Spain, Italy and France has declined over the last fifteen years, explaining that this would contribute to an increase in unemployment rates.
There was an extensive Q&A with students following his presentation.
One student asked if the European project is a failure. Artus explained that in many respects it is a failure because it has created unanticipated problems. These problems being that the European union has increased disparities across regions in Europe – some regions have become more industrialised while others have lost their industries. This happened because the single European economic area makes the circulation of money, business and people even easier.
Another student asked how we could weaken the euro currency so as to improve exports. Artus replied that the euro is strong because there is still strong confidence in the European project. He quipped that the easiest way to weaken the euro would be to have crazy (or crazier!) politicians.
Artus pointed to a possible solution for France, suggesting firms position themselves at a higher value added level of the market (for example higher quality cars), and to move away from lower quality products where low-wage countries are far more competitive.
This conference was held within the framework of the partnership SKEMA has with the OFCE (Economic Research Centre of Science Po - Paris) and its different departments (Analysis and Forecasting, Economics of Globalisation, Research, and Research on Innovation and Competition) located in Paris and in Sophia Antipolis.