The project "Financial Infrastructure: Risks and Regulation" aims at studying the new regulatory framework in the organization of exchanges between financial institutions, called financial infrastructure. Following the financial crisis of 2008, major reforms of the financial market infrastructure have been undertaken worldwide. The goal of these reforms, only partially implemented, is to enhance the stability of the financial system, thereby ensuring a better financing of the economies and preventing taxpayers from paying for the failure of financial institutions. Our main objective is to assess the effectiveness of these regulatory measures on the risk of the financial system. The G20 in Pittsburgh in 2009 have been pushing for profound changes in the organization of exchanges to correct two shortcomings that might have explained the amplitude of the crisis: first, the exchanges of non-standard assets, such as sub-primes, from the United States to most Western countries through unidentified chains of intermediaries (the so-called shadow banking); second, the complexity and opacity of contracts linking institutions, as those of Lehman Brothers. To limit and better control these arrangements, regulators have required the use of Central Counter-Parties (CCP) for most transactions involving derivative securities, and the mandatory report of all trades on derivatives through companies called Trade Repositories (TRs). Central counter-parties are thus called to play a crucial role in preventing market disruptions such as Lehman Brothers. Though, a new risk arises: all members of a Central counter-party are exposed to its failure, which could have dramatic effects on markets and macroeconomic stability. While the studies on exchanges are vast, central counter-parties have so far received very limited attention and important aspects of the regulation are still under discussion. Our project aims to be a significant step in a comprehensive analysis of the impact of the CCPs on the stability of the financial markets and ultimately on the financing of the economy. To achieve our objectives, we need to make progress on three intertwined topics on the financial institutions and infrastructures: their regulation, their strategic behaviours and the systemic risk these generate. To this end, the project is divided into three parts, which study respectively the management of risks by a CCP, the impact of CCPs on the financial institutions and trades and the competition and interdependencies between CCPs and their regulators. We expect our project to help to design resilient institutions and infrastructures, to promote research in financial economics, and to make accessible to a large audience the functioning of how the financial institutions operate to get a better understanding of the risks they cover and generate. The project brings together researchers in finance and economics, with both empirical and theoretical expertise.

Contemporary economies in Europe are constantly seeking ways to accelerate growth and achieve sustainable economic development. In this context, public policies play a crucial role: Among them are competition policy to monitor the behavior of firms, and procurement and regulatory policies which are designed to organize specific sectors. Recognizing the importance of public intervention as a major determinant of growth is only a starting point. Achieving good public policies requires the supervision of a public authority which implements efficient mechanisms in order to regulate the corporate behavior in firms. How these tools should be designed and implemented is subject to economic debate. Over the last 30 years, the literature focusing on industrial economics has proposed theoretical rules to researchers on how markets should be organized and regulated in order to maximize social welfare. Very few empirical tests of these theories have been proposed however. The aim of this research project is to attempt to bridge the gap between theory and reality, so that the tools of the economists can be understood and used by practitioners. This project has four main objectives: (i) To propose guidelines that help separating regulatory models that represent the economic reality of an industry from those that describe the optimal mechanisms to which the organization of the industry should aim to (positive versus normative analysis), (ii) to propose original microeconomic, statistical and econometric methodologies which allow representing the characteristics of the markets under scrutiny, (iii) to collect data and construct original databases that will be run in this current project and could be useful in future research, and (iv) to derive results that are useful for practitioners. To illustrate the variety of issues within the general theme of the project, we can raise the following questions: To what extent do the rules of competition in the markets affect the decisions of firms to improve their productivity and efficiency? Does competition guarantee low prices to consumers? Do the liberalization of utility industries and the search for new provision modes by public authorities accelerate the use of outsourcing? What are the efficiency conditions of competition for the market? How should the relationships between the governments and firms be organized in public-private partnerships? How should optimal regulatory rules be designed in order to maximize social welfare? Are regulators competent, sophisticated and benevolent enough to implement optimal regulatory rules? Should mergers between firms be allowed in industries where competition for the market is organized? These are just some examples of issues where an approach involving economists working in different fields such as industrial organization, contract theory, competition policy, and applied econometrics is of major interest. The Université Paris 1, Paris School of Economics, and GREMAQ offer a set of recognized talent in these disciplines and the first objective of this project is to unite the forces inside a team around these issues, which we think are important both in terms of research and public policy.

The FARM_VALUE project’s objective is to contribute to scientific knowledge and to provide new perspectives to farm stakeholders and policy-makers on farm transfers, focusing specifically on the role of the value of the farm in this process. The project aims at carrying for the first time in the literature a thorough assessment of how the value of a farm is assessed, both from economic and sociological points of view, and how both points of view can (or should) be fully integrated in the context of farm transfer. Studying the issue with both economic and sociological perspectives has never been done so far to our knowledge, although this is of high value for this particular issue: generally, the farm value used during transfers by professional stakeholders is given by economic or financial metrics; however, the latter do not account for sociological value (e.g. the fact that the farm assets are family assets), which may be so high that it prevents transfer. More specifically, we aim at (1) updating the current state of the art on farm value and suggesting methodological extensions or alternatives in particular from finance; (2) considering the diversity of components in a farm value, and in particular farm intangible assets, whether these are economic aspects (such as the role of the farm in a territory, managerial skills, payment rights or contracts) or sociological aspects (such as professional knowledge); (3) linking the value of a farm to its transfer, by analysing farmers' wealth accumulation strategies, transferred farms' performance, and the way shares are valued in partnership farms. The empirical application is to France, and in particular on dairy and beef cattle farming in three regions, Auvergne-Rhône-Alpes, Bourgogne-Franche-Comté and Bretagne. The dairy and beef cattle sector has been chosen here since it is particularly affected by succession problems: high farm value due to animals as well as buildings and machinery associated to the animals; hence, high transfer cost; low attractiveness due to hard working conditions implied by the care of animals day and night; and by contrast low profitability. The three main regions have been selected as they present various economic environments as well as different cultural heritage and social values. On a methodological point of view, we will make use of existing economic data that are little exploited for this issue, such as the French Farm Accountancy Data Network (FADN) and the European Household Finance and Consumption Survey. We will also perform a survey to hundreds of farmers to complement these data, as well as semi-directive interviews that allow account for personal ties between partners in a collective farm, and family ties over several generations.

This project analyses the demand for marital conflict resolution services in West Africa and the impact of state intervention on gender inequalities. Using the experiences of native courts and maisons de justice in Senegal, we examine the short and long-term effects of the expansion of public justice services on gender norms and the relationship of litigants with the state. We also propose different experiments to help identify approaches to extend public services for marital conflict resolution to populations in need.

In this project, we will develop a behavioral economics module within the Constances epidemiological cohort in order to measure patient’s individual economic preferences toward risk, ambiguity and time. These psychological variables and the associated biases are the cornerstones of the normative and descriptive models of individual health decisions in health and behavioral economics. In WP1, we will administratively and logistically set up, implement and include an innovative behavioral economics module on individual preferences within the Constances cohort. We will conduct a web-based questionnaire to an online representative sub-sample of Constances volunteers in two waves at a one-year interval. Our aim is to collect a repeated measure of individual preferences of 5000 Constances volunteers. We will link this module to Constances survey data and medical records as well as relevant data from the French national security database (SNIRAM). We will hire specifically for this project a data manager and a data scientist (for respectively 24 and 18 months) who will prepare the dataset and preliminary statistics and will assist the scientific teams in charge of the four research projects presented hereafter. In WP2, we will investigate the evolution of individual preferences in a life course perspective and more precisely the causal and selection effects linking socioeconomic position to individual preferences (WP2.1) and the role of the patient’s health history in the evolution of individual preferences over time (WP2.2). In WP3, we will examine how individual preferences and socioeconomic indicators (SEP and economic insecurity) jointly determine individual choices of health-related behaviors in terms of primary prevention (e.g. over-eating, poor diets, lack of physical activity, smoking, alcohol abuse, drug use, sleep deprivation) and of secondary prevention (in particular for breast and cervical cancer screening) (WP 3.1) and of decisions related to pollution exposure and residential area (WP 3.2). The results of these studies will inform public policy makers on the decision making process involved in individual health-related behaviors and the social inequalities in health they can induce. Also, the unique dataset resulting from the BeHealth project will constitute a precious public good for national or international researchers in health economics, medicine, epidemiology and public health interested by the concepts developed in behavioral economics on individual preferences and deviations (or biases) from economic rationality.