Abstract

France is one of the most developed countries in the world. Along with Germany, it has played a vital role in the creation of the euro. Even in an era of liberalisation, privatisation and globalisation, the French believe in a strong government. On one hand, the privatisation efforts continue, and on the other, the government still controls major firms in several sectors. High unemployment, a major social and economic problem in the country, has its roots in high tax rates and rigid labour markets. France also has a heavy pension burden. Excessive labour regulation has become a hindrance to investing in France. Of late, France’s stance in international politics has been sending confusing signals. The country remains an enigma. On one hand, it does not hesitate to criticise the US and on the other, many French companies follow a pro-US business model. The case illustrates the challenges which developed economies face in retaining their competitiveness.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• 0

Keywords

Country case study of France, Privatisation, Euro, Unemployment, Macroeconomics, Labour regulation, Jacques Chirac, Francois Mitterrand, Economic policies in France, Economic and Monetary Union, Maastricht Treaty, Labour productivity, Laurent Fabius