Zoulfikar Mehoumoud Issop (p), Yves Croissant, Sabine Garabedian, Alexis Parmentier

Francois Hermet

This article analyzes wage inequalities in some French OR (overseas regions) for the year 2016. We compare the wage distribution between the OR and with mainland France through distributional Social Accounting Matrices (SAM). The construction of our original SAM builds on different data surveys (the Annual Social Data Declarations and regional accounts published by INSEE). It allows to compare wages for three skill levels (less qualified, qualified, very qualified) and two status (public and private) within a coherent and unified accounting framework.

Our work is related to the literature on the French Distributional National Accounts (DNA) (see for instance Accardo, 2020, Accardo et al., 2017 or Amar et al., 2008 and 2021) and on the “International Distributional National Accounts” (DINA) (see for instance Piketty et al. 2018, Bozio et al., 2020 or Alvaredo et al., 2020). The DNA or DINA are based on a method that connects individual data from social statistics to macroeconomic aggregates of national accounts. They provide a description of the distribution of national income and an estimate of the reduction of inequalities achieved thanks to all public transfers received or paid by households. The DNA also enables international comparability of inequalities by providing a unifying and robust framework.

To our knowledge, our article is the first using this approach to make such detailed comparisons on wage inequalities between the ORs and between the French ORs and mainland France. We show that many differences on wage inequalities between territories are explained by the weight of the public sector, which is higher in the ORs than in France, and by the differences in the level of qualifications of workers employed in each sector, reflecting the differences in specialization in each territory: in industry and market services in France vs non-market services in ORs. However, the strong tertiarisation of jobs in all the regions implies similar wage distributions whatever the level of qualification: they are higher in the service sectors (market and non-market) than in the other sectors.

Ambre Maucorps (p), Mário Fortuna, Tomás Lopes Cavalheiro Ponce Dentinho, Philippe Jean-Pierre, Sergio Moreno Gil, Patricia Picazo Peral

Zoulfikar Mehoumoud Issop

The EU has nine outermost regions: Guadeloupe, French Guiana, Réunion, Martinique, Mayotte and Saint-Martin (France), the Azores and Madeira (Portugal) and the Canary Islands (Spain). Altogether, close to five million people live in the outermost regions, which is slightly more than 1% of the EU’s total population. These regions are, by definition, located far away from the European continent and are thus granted tailored support from the EU (through Article 349 of the Treaty on the Functioning of the European Union) to compensate for the (natural and structural) drawbacks linked to their geographical situation. While facing a range of common challenges linked to their geographic features, the EU’s outermost regions are very diverse when it comes to their demographic and socio-economic profiles. This has, in turn, influenced their economic development path and still weighs heavily on their convergence prospects.

In this context, the role of EU Cohesion Policy and the European Structural and Investment Funds in supporting (sustainable and inclusive) growth in the outermost regions, the majority of which are categorised as ‘less developed regions’ in the 2021-2027 Cohesion Policy framework, appears to be decisive. Yet their impact is hard to assess due to the diverse and rapidly changing profiles of the outermost regions in terms of geographic, environmental, economic, social and demographic characteristics, as well as the multifaceted nature of the institutional and governance systems in place there. Logically, the role of place-based, tailor-made approaches (not least as part of EU Cohesion Policy) to overcome regional disparities and build on the outermost regions’ assets deserves particular attention.

This paper describes the unique situation and specificities of the outermost regions and investigates the role of Cohesion Policy in exploiting opportunities for their socio-economic development. It is extracted from a study (Maucorps et al., 2024) contracted by the European Parliament that builds on both primary and secondary data and uses different analysis methods. It combines a qualitative and statistical analysis of the outermost regions’ profiles and development paths (based on Eurostat, national and regional data sources), a literature review of policy documents and studies related to EU Cohesion Policy and other cohesion-enhancing strategies, interviews with key regional stakeholders, and in-depth case studies focusing on three outermost regions: Réunion, the Azores and the Canary Islands.

Francois Hermet (p), Sebastein Bourdin, Philippe Jean-Pierre (p), Idriss Fontaine

Ambre Maucorps

During the 1990s, the concept of the "blue banana" was introduced to highlight the economic imbalance between the developed central Europe, spanning from Greater London to Rome, and the less-developed peripheral regions of Europe. Since then, various enlargements and the implementation of cohesion policy in the underdeveloped regions have occasionally reshuffled the dynamics.
While the issue of disparities has been extensively studied in the theoretical (geographical economics) and empirical (analysis of growth, convergence, space) literature on regional development, most of the research has relied on databases at the regional (NUTS 2) or even sub-regional (NUTS 3) level, particularly those provided by Eurostat. However, this meso-economic approach to regional development obscures the considerable variations that exist when examining development at the local level.
Against the backdrop of a growing body of literature in regional science on development traps, our article investigates whether the blue banana still remains as the economic core of Europe or whether a more nuanced understanding of this meso approach can be observed at the micro-local level. Specifically, we aim to identify (i) whether there are areas within the blue banana where development is stagnating or progressing at a significantly slower rate, and (ii) whether there is evidence of the emergence of new economic development zones in Europe that could serve as alternatives or complements to the blue banana. This aspect of our study provides fresh insights into the spatial dynamics of European economic development, considering recent changes and emerging trends that have the potential to redefine Europe's economic landscape.
The originality of our contribution lies in the utilization of satellite night-time light data as a proxy for economic activity. Nowadays, academic research can leverage satellite light data to gain a better understanding of the determinants of economic growth and development. The pioneering work by three researchers from Brown University in 2012, Vernon Henderson, Adam Storeygard, and David Weil, has paved the way in this field. Another advantage of using this data is that it is consistently collected across all regions, enabling us to examine growth and convergence dynamics while including the outermost regions that are often overlooked in analyses due to a lack of long-term data.
Ultimately, our findings aim to strengthen the empirical literature on convergence analysis and either confirm or challenge the conclusions of existing studies on catch-up dynamics, development traps, and the experiences of regions that have been left behind.