The sources of decentralised output fluctuations in France

Abstract

International audienceThis paper examines the sources of disturbances to short-term and long-term output variations in the French regions. We use an error-components model that decomposes decentralised output movements into common national, industry-specific, region-specific, and idiosyncratic effects. We find that industry-specific disturbances account for the major part of the variance of the systematic component of decentralised output fluctuations. Moreover, decentralised regional policy strategies that do not target specific sectors within the region only have a very limited impact on both short-term and long-term sectoral output variations