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What accounts for the gap between the rise in the public debt ratio in France and Germany?
The public debt ratio rose from 10% of GDP in the early 1970s to 1 10.6 % of GDP in 2023 in France, and from 18% of GDP in 1970 to 64% of GDP in 2023 in Germany. We are trying to identify the causes of this gap between the increases in the public debt ratio in France and Germany. We can think of the following explanations: The difference between employment rates, and therefore between tax revenues; The structurally greater generosity of social welfare (public spending on pensions, family support, healthcare and housing) in France; The reversibility, in Germany, of increases in public spending or tax cuts when they have been increased by a recession, and their irreversibility in the same circumstances in France.
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Patrick Artus
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