Identifying Priority Service Sectors for Reforms in France

Magdalena Kizior, Dominique Simonis, Edouard Turkisch and Irene Vlachaki

No 35, European Economy - Economic Briefs from Directorate General Economic and Financial Affairs (DG ECFIN), European Commission

Abstract: Given their high economic importance, their high labour intensity and their increasing contribution to manufacturing exports, services in France have a strong potential to create jobs and enhance productivity and contribute to overall competitiveness. Despite recent reform efforts in some service sectors, a number of issues continue to hamper activity in those sectors that need to be addressed. In order to help prioritise reforms in services in France, this paper identifies sectors that are both economically important and score relatively poorly with respect to three dimensions of market performance (competition, openness, innovation). This screening exercise points to a set of sectors with a relatively weak performance when compared to other service sectors in France. A cross-country comparison with the performance of the identified sectors in the other large euro area economies (Germany, Spain, Italy) and the UK is then provided. The results show that, despite a relatively good market performance overall, several service sectors of major economic importance in France are characterised by low competition. This is notably the case for a number of business services (architectural and engineering activities, administrative and support services), as well as for the sectors of retail trade, accommodation and food services, and health. This analysis provides useful insight about the challenges in some sectors, which would be candidates for reforms in priority, and invites further analysis on the causes of their weak performance.

Keywords: France; services; market performance; structural reforms; Kizior; Simonis; Turkisch; Vlachaki. (search for similar items in EconPapers)
JEL-codes: L10 L80 (search for similar items in EconPapers)
Pages: 20 pages
Date: 2018-03
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