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Climate: the Next Threat Issue 21 Winter 2021 Toulouse School of Economics Climate: The next threat Toulouse School of Economics www.tse-fr.eu 1 Esplanade de l’Université, [email protected] 31080 Toulouse Cedex 06 twitter@TSEinfo France Editor’s Message Toulouse School of Economics Contents Economics for the Common Good TSE faces 4. Grants, News Appointments, Books & Prizes the future & Events Policymakers have rarely been more in need of good advice. With 6. Africa’s 10. Google’s infections resurging this winter, they tread a narrow and treacherous recovery innovation path between the precipice of the pandemic on one side, and an Interviews Makhtar Diop Hal Varian economic chasm on the other. As Victor Gay highlighted in the TSE Inaugural Lecture, the combination of these twin crises may leave scars that take many decades to heal. In the long run, however, no challenge is greater or in more urgent 14. A Climate 20. The food 24. Do vehicle need of evidence-based action than that of global warming. The Climate: coalition and climate emission Covid-19 crisis has exposed our collective failure to recognise that the Jean Tirole puzzle standards work? health of our bodies, economy, and planet are deeply interconnected. Céline Bonnet Mathias Reynaert Yet it has also been a reminder that when a collective will exists, everything is possible. The next 18. The health 22. Europe bets of our planet on hydrogen TSE’s crisis response is testament to this spirit. Our researchers Christian Gollier, Experts panel Claude Crampes have adapted admirably, even under the latest lockdown: finding TSE Director & Stefan Ambec innovative ways to teach and inspire the economists of tomorrow, threat interacting with the public in lively debates, and maximizing the productivity benefits of collaborating remotely. We are proud of the success of regular webinars and our first online conferences. Difficult circumstances and growing enthusiasm for economic expertise have 26. Emmanuel inspired us to embrace new media and new audiences. Farhi Tribute In Jean Tirole I am deeply honored to be leading the climate team for President Macron’s commission charged with finding solutions to the challenges of the Covid-19 era. My own work benefits enormously from the breadth and depth of environmental research in Toulouse, which is Memoriam very much on display in this issue. Introduced by Jean Tirole’s call for a new climate coalition, our special dossier includes a warning by Claude Crampes and Stefan Ambec that Europe’s embrace of hydrogen is a risky bet. Following the Volkswagen testing scandal, Mathias Reynaert 30. TSE Inaugural asks if vehicle emissions standards really work; and Céline Bonnet Lecture 2020 discusses the challenge of changing our high-carbon eating habits. Experts Victor Gay We also cherish the memory of the late Emmanuel Farhi, a stellar example to economists everywhere. And as part of our commitment to engage with global decision-makers, we feature interviews with Makhtar Diop on his work as the World Bank’s Vice President for Infrastructure, and Google’s chief economist Hal Varian. Wishing you good health in these difficult times. Biannual magazine www.tse-fr.eu Publication Director: With the help of Pictures: This magazine has been funded of the Toulouse School Christian Gollier Claire Navarro studiotchiz by a French government subsidy of Economics [email protected] James Nash fotolia managed by the Agence Nationale Managing Editor: istock de la Recherche under the framework 1, Esplanade Tél +33 (0) 5 67 73 27 68 Joël Echevarria Layout design unsplash of the investissements d’avenir de l’Université. Blackpaper.fr Mariana Cook programme reference 31000 Toulouse Editor in chief: ANR-17-EURE-0010. France Jennifer Stephenson 1000 printed magazine Production Manager: ISSN: 2554-3253 Jean-Baptiste Grossetti 2 3 News & Events Toulouse School of Economics News & Events Economics for the Common Good Appointments European Heritage Days 2020 On May 29, the French President appointed TSE founder News Macron TSE opened its gates to the public for this year’s European Heritage Jean Tirole and former IMF chief economist Olivier Days. More than 300 visitors enjoyed a guided tour of our new invites TSE Blanchard to lead a special commission on ideas for building designed by Grafton Architects, winners of the 2020 Pritzker the world after Covid-19. The team of 26 international Prize. experts economists will focus on three major challenges: climate, to guide inequality and demography. TSE director Christian Gollier Pierre Dubois joins the The Journal of the European will lead efforts to respond to global warming. Economic Association as co-editor Covid-19 The commission will conclude its work with a report to be The TSE-UT1C professor will become co-editor starting January response published in 2021. 2021 of the presigious journal, covering IO, Health and Development economics. “I am honored and delighted to be part of this commission,” said Jean. “Unemployment, over- indebtedness and purchasing power are crucial TSE Public Webinar series concerns, but we also need an overall vision for the future of our society. Thinking with leading economists TSE held two public webinars, one in June and one in November on on how to respond concretely, credibly and effectively to the Covid-19 crisis. In June, Zohra Bouamra-Mechemache (TSE- these long-term challenges will be very exciting.“ INRAE) discussed the impact of the pandemic on food and climate, Christian Gollier discussed tackling the climate crisis during the pandemic. In November Victor Gay (TSE-IAST-UT1C) detailed the long term economic impact of Covid-19 while Astrid Hopfensitz (TSE- IAST-UT1C) insisted on the psychological side of the crisis. Report on EU-Mercosur trade deal delivered to French government To evaluate the impact of the EU-Mercosur trade deal on sustainable development, the Prime Minister commissioned a panel of experts Prizes TSE building receives the Equerre d’Argent 2020 chaired by Stefan Ambec, Director of the TSE Energy and Climate This architectural annual prize, organized by French magazine AMC, Center. Their report finds that opening up markets will bring limited rewards the best projects in France. trade benefits but increase deforestation and carbon emissions. “The EU missed an opportunity to use its negotiating power to obtain solid guarantees that meet the environmental, health and social TSE ranked best in Europe for economics concerns of its citizens,” said Stefan. His panel has recommended substantial amendments and better impact assessments. The Academic Ranking of World Universities, commonly known as the “Shanghai Ranking”, has named TSE as the top institution in economics in continental Europe and 22nd in the world. Wilfried Sand-Zantman joins French gambling regulator TSE founder urges Toulouse The TSE-UT1C-ESSEC professor has been appointed as one of to embrace its youth the nine members of the Autorité Nationale des Jeux (ANJ), an Jean Tirole recently led an independent commission charged with independent authority in charge of regulating gambling in France. It rethinking the economic future of the Toulouse area in the wake of aims to protect the vulnerable and prevent fraud. the Covid-19 crisis. Delivering its recommendations in September, he was cautiously optimistic given the city’s strengths including Digital Center director receives Antitrust Award the untapped potential of its young population, space industry and tourism sector. TSE’s Jacques Cremer, along with Yves-Alexandre de Montjoye and Heike Schweitzer, received the prize in the Soft Law and General Antitrust categories for ‘Competition Policy for the Digital Era’, a report written for the European Commission. 4 5 Interviews Toulouse School of Economics Africa’s recovery Economics for the Common Good “With the COVID-19 recovery, now is the time to accelerate progress towards more sustainability and inclusion” Makhtar Diop, World Bank Vice President for Infrastructure Can you summarize your current Do you have examples of such Jointly organized by TSE and priorities within the World Bank’s financing? Makhtar Diop, World Bank Vice Infrastructure Department? President for Infrastructure, Suggested: We focus on developing Our goal is to fill what are known as countries, since this is our core the first annual Infra4Dev infrastructure gaps, and to do this we mission. We have seen in the power conference took place last must try to increase the level of public sector a number of investments in December in Toulouse. Here, investment in the infrastructure public-private partnership (PPP) and sector and, above all, improve the power purchase agreement (PPA) the Senegalese economist quality of public investment. It is also where the private sector commits to explores the links between clear that public resources are not sell electricity to distribution infrastructure, digitization and sufficient to make up the shortfall and companies that are very often public private sector investment is needed. and thus reduce the weight of their regulation, and reflects on the Finally, our goal is to assist countries CapEx (capital expenditure). Many implications for Africa’s future in their post-COVID-19 recovery power plants today, apart perhaps in a time of unprecedented process. The big question is: how from hydroelectricity, are private to get these actors to help rebuild sector-led projects. We see in crisis. better and maintain infrastructure? renewable energies such as solar We have a department in charge and wind power, many investments of this financing, which aims to set made by the private sector. Whether up instruments such as purchasing in Ghana, Senegal or Zambia, we are power parities and guarantees in now succeeding in having electricity order to attract both national and production provided by the private foreign financing. sector. This is even more interesting 6 7 Interviews Toulouse School of Economics Africa’s recovery Economics for the Common Good since these investments are in You were the World Bank’s Vice process these raw materials.
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