Économie et Statistique n° 422 - 2009 Breakdown of Value Added in France, 1949-2008 - The Impact of Students' Paid Employment on Pursuit and Completion of University Studies - Labour Supply of Mothers in France: Causal Effect of the Shift from Two to Three Children
Breakdown of Value Added in France, 1949-2008: Methodological Aspects
The breakdown of value added is an issue that touches on several economic-policy concerns: changes in earnings, production-factor substitution, and unemployment. The recent report submitted to the French President on the breakdown of value added, the distribution of profits, and pay differentials in France (cf. Cotis, 2009) attests to the topicality of the debate on the breakdown of value added in France. The report’s conclusions rest, among other evidence, on base-2000 national-accounts data that INSEE has backcast to 1949 and recently published. This article gives details on the preparation, use, and interpretation of these data. It explains the main differences with national accounts referenced to earlier base years: breakdown of financial intermediation services indirectly measured (FISIM), definition of taxes and subsidies; method for determining value added. The study also revisits the theoretical determinants of the value-added breakdown, notably the influence of real interest rates. This influence could, no doubt, be better understood (1) by distinguishing between the short-term and long-term effects of the cost of capital, as well as of the labour cost, on the value-added breakdown, and (2) by simultaneously analysing the value-added breakdown and production-factor substitution.