Report
Patrick Artus

What accounts for households' purchasing power in France?

We break down (over the last 5, 10, 20 years) the increase in French households' purchasing power between what is due to: Real wages (and we compare real wages and productivity); Employment; Capital income; Net government transfer payments (taxes). We see that the growth in real disposable household income is driven by real wages, which grow faster than productivity; employment stagnated and capital income declined after the subprime crisis; net public transfer payments moved in line with real income until the COVID crisis (they obviously increased sharply during the COVID crisis). What to make of these developments? It is interesting to see that it is wages that are dynamic, and not at all capital income; It is also interesting to see that taxes paid by households evolve at the same pace as transfer payments to households; It would probably be healthier if real wages did not grow more than productivity and employment grew faster.
Provider
Natixis
Natixis

Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.

 

Analysts
Patrick Artus

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