Euro zone: Now it is France’s turn to benefit from a positive supply shock

Supply-side policies have been positive for Germany (from 2001) and Spain (from 2009). Now it is France ’s turn to benefit from a positive supply shock: Improvement in cost competitiveness relative to the other euro-zone countries; Fall in labour costs thanks to the reduction in corporate social contributions; A rise in the participation rate, i.e. in the labour supply. These positive supply shocks can be expected to lead France to post the best economic performance of the large euro-zone countries.