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Laura Lebastard
Economics
- Division
Euro Area External Sector
- Current Position
-
Economist
- Fields of interest
-
International Economics
- Education
- 2014-2017
PhD in economics, university Paris-Saclay
- Professional experience
- 2021
Economist - Euro Area External Sector Division, Directorate General Economics, European Central Bank
- 28 October 2024
- OCCASIONAL PAPER SERIES - No. 359Details
- Abstract
- Based on granular data at the product level, this paper looks at whether and how the euro area and the United States have modified their import sourcing strategies since 2016, the role played by geopolitical tensions and the potential impact on import prices. It considers two different, but not mutually exclusive, changes to sourcing strategies for a given product: (i) increasing the number of sourcing countries and (ii) reducing the import market share of the main supplier country. Data suggest that both regions have, on average, increased the number of sourcing countries, particularly for products that are mostly imported from “geopolitically distant” countries (based on UN General Assembly voting records). Broadening the number of supplier countries has come at a cost; however, it has affected only a small share of total imports, with modest implications for inflation and the terms of trade. At the same time, evidence of a reduction in the import share of the main supplier country is more mixed and is generally associated with a shift towards cheaper – but not necessarily geopolitically closer – countries, suggesting that cost considerations take precedence over supply chain resilience and national security concerns.
- JEL Code
- F14 : International Economics→Trade→Empirical Studies of Trade
F51 : International Economics→International Relations, National Security, and International Political Economy→International Conflicts, Negotiations, Sanctions
F62 : International Economics→Economic Impacts of Globalization→Macroeconomic Impacts
- 21 October 2024
- WORKING PAPER SERIES - No. 2992Details
- Abstract
- We study how disruptions to the supply of foreign critical inputs (FCIs) —that is, inputs primarily sourced from extra-EU countries with highly concentrated supply, advanced technology products, or which are key to the green transition —might affect value added at different levels of aggregation. Using firm-level customs and balance sheet data for Belgium, France, Italy, Slovenia and Spain, our framework allows us to assess how much geoeconomic fragmentation might affect European economies differently. Our baseline calibration suggests that a 50% reduction in imports of FCIs from China and other countries with similar geopolitical orientations would result in sizable losses of value added with significant heterogeneity across firms, sectors, regions and countries, driven by the heterogeneous exposure of firms. Our findings show that the short-term costs of supply disruptions of FCIs can be substantial, especially if firms cannot easily switch away from these inputs.
- JEL Code
- F10 : International Economics→Trade→General
F14 : International Economics→Trade→Empirical Studies of Trade
F50 : International Economics→International Relations, National Security, and International Political Economy→General
F60 : International Economics→Economic Impacts of Globalization→General
- 9 October 2024
- THE ECB BLOGDetails
- JEL Code
- E50 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→General
F13 : International Economics→Trade→Trade Policy, International Trade Organizations
F43 : International Economics→Macroeconomic Aspects of International Trade and Finance→Economic Growth of Open Economies
- 1 August 2024
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 5, 2024Details
- Abstract
- Based on granular data at the product level, this box discusses whether and how the euro area and the United States have modified their import sourcing strategies since 2016, the role played by geopolitical tensions and the potential impact on import prices. It considers two different, but not mutually exclusive, strategies: increasing the number of sourcing countries and reducing the import market share of the main supplier country per product. Data suggest that both regions have increased, on average, the number of sourcing countries, particularly for those products mostly imported from geopolitically distant countries. Broadening the number of supplier countries has come at a cost, however, it has affected only a small share of total imports, with modest implications for inflation and the terms of trade. At the same time, evidence of a reduction in the import share of the main supplier country is more mixed and is generally associated with a shift towards cheaper – and not necessarily geopolitically closer – countries, suggesting the prevalence of cost considerations over supply-chain resilience and national security concerns.
- JEL Code
- F14 : International Economics→Trade→Empirical Studies of Trade
F51 : International Economics→International Relations, National Security, and International Political Economy→International Conflicts, Negotiations, Sanctions
F62 : International Economics→Economic Impacts of Globalization→Macroeconomic Impacts
- 25 April 2024
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 3, 2024Details
- Abstract
- This box investigates the drivers of the weakness in euro area imports in 2023. After rebounding in mid-2022 as a result of the easing supply bottlenecks for goods and the lifting of mobility restrictions in the aftermath of the pandemic, the euro area imports-to-GDP ratio fell in the first quarter of 2023 and has remained at a lower level since then. We show this is mainly due to the composition of GDP growth following a period characterised by weak exports and consumption. These are two of the most import-intensive components of GDP, in particular exports, owing to the downstream position of the euro area in the supply chain. Destocking also had an important role in the decline, as well as the shift in consumption from goods to services, which are less import intensive.
- JEL Code
- F14 : International Economics→Trade→Empirical Studies of Trade
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E22 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Capital, Investment, Capacity
E32 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Business Fluctuations, Cycles
- 27 February 2024
- OCCASIONAL PAPER SERIES - No. 341Details
- Abstract
- This paper studies the short-term and long-term consequences of the COVID-19 pandemic for productivity in Europe. Aggregate and sectoral evidence is complemented by firm-level data-based findings obtained from a large micro-distributed exercise. Productivity trends during the COVID-19 pandemic differed from past trends. Labour productivity per hour worked temporarily increased, while productivity per employee declined across sectors given the widespread use of job retention schemes. The extensive margin of productivity growth was muted to some degree by the policy support granted to firms. Firm entries declined while firm exits increased much less than during previous crises. The pandemic had a significant impact on the intensive margin of productivity growth and led to a temporary drop in within-firm productivity per employee and increased reallocation. Job reallocation was productivity-enhancing but subdued compared to the Great Recession. As confirmed by a granular data analysis of the distribution of employment subsidies and loan guarantees and moratoria, job reallocation and also debt distribution and“zombie firm” prevalence were not significantly affected by the COVID-19 policy support. The pandemic and related lockdowns accelerated changes in consumer preferences and working habits with potential long-term effects. Generous government support muted the surge in unemployment and reduced permanent scarring effects.
- JEL Code
- D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
H25 : Public Economics→Taxation, Subsidies, and Revenue→Business Taxes and Subsidies
J38 : Labor and Demographic Economics→Wages, Compensation, and Labor Costs→Public Policy
O47 : Economic Development, Technological Change, and Growth→Economic Growth and Aggregate Productivity→Measurement of Economic Growth, Aggregate Productivity, Cross-Country Output Convergence
- 6 November 2023
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 7, 2023Details
- Abstract
- This box summarises the findings of an ad hoc survey of leading firms operating in the euro area, looking at current trends in global production location and input sourcing, and their impact on activity and prices. The responses indicate that firms increasingly expect to respond to heightened geopolitical risk. In the next five years, more so than in the last five years, firms expect to diversify the location of their operations and their sources of inputs, and to move operations and supply chains to countries that are geographically and geopolitically closer to the final points of sale. Many firms that source critical inputs from China are reducing this exposure. Geopolitical risk is now the most important factor behind decisions to relocate operations into the EU, while demand and cost factors still drive relocations out of the EU. Overall, the aggregate impact which relocation decisions will have on the share of value added generated by firms in the EU is unclear, but such decisions have already pushed up prices and will continue to do so – albeit to a lesser extent – in the next few years.
- JEL Code
- C83 : Mathematical and Quantitative Methods→Data Collection and Data Estimation Methodology, Computer Programs→Survey Methods, Sampling Methods
F13 : International Economics→Trade→Trade Policy, International Trade Organizations
F51 : International Economics→International Relations, National Security, and International Political Economy→International Conflicts, Negotiations, Sanctions
L23 : Industrial Organization→Firm Objectives, Organization, and Behavior→Organization of Production
- 12 July 2023
- THE ECB BLOGDetails
- JEL Code
- F60 : International Economics→Economic Impacts of Globalization→General
F18 : International Economics→Trade→Trade and Environment
- 12 April 2023
- THE ECB BLOGDetails
- JEL Code
- F51 : International Economics→International Relations, National Security, and International Political Economy→International Conflicts, Negotiations, Sanctions
- 30 March 2023
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 2, 2023Details
- Abstract
- The box provides an assessment of the impact of the pandemic on the exports of firms involved in global value chains (“GVC” firms), based on firm-level data for France. Following the outbreak of the pandemic, GVC firms, defined as firms that both export and import, faced disruptions in their supplies from source countries. These shortages of intermediate inputs traded via global value chains constrained firms’ production and exports. The weaker export performance of GVC firms relative to other exporters coincided with the emergence of supply bottlenecks, which suggests that these disruptions were a key factor holding back the performance of firms involved in global value chains. Estimates in this box suggest that these supply-side disruptions had a significant downward impact on exports in the euro area in 2020 and 2021.
- JEL Code
- D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
F14 : International Economics→Trade→Empirical Studies of Trade
F61 : International Economics→Economic Impacts of Globalization→Microeconomic Impacts
- 22 March 2023
- RESEARCH BULLETIN - No. 105Details
- Abstract
- We assess the impact of the pandemic and the ensuing disruptions to global value chains (GVCs) on exporting firms. We find that firms’ participation in GVCs increased their vulnerability to the pandemic shock, in terms of export sales and probability of survival. Firms further downstream in GVCs were more severely affected by supply disruptions. At the same time, our results suggest that exporting firms benefited from sourcing their core inputs from different countries, supporting the hypothesis that diversification in global value chains fosters supply chain resilience.
- JEL Code
- D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
F14 : International Economics→Trade→Empirical Studies of Trade
F61 : International Economics→Economic Impacts of Globalization→Microeconomic Impacts
- 14 February 2023
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 1, 2023Details
- Abstract
- The box investigates the role of energy prices in the dynamics of euro area industrial production and goods import volumes since autumn 2021, when gas supplies from Russia to the European Union (EU) were curtailed significantly. Despite the sharp rise in energy prices and the uncertainty generated by Russia’s invasion of Ukraine, euro area industrial production has fluctuated without exhibiting a clear trend, while import volumes of goods excluding energy have risen steadily. Several factors, such as adverse energy supply shocks in combination with the easing of supply bottlenecks and a recovery in demand, are behind these developments. There are signs that cheaper imports, particularly of intermediate goods, have acted as substitutes for domestic manufacturing production in more energy-intensive sectors.
- JEL Code
- E31 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Price Level, Inflation, Deflation
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
- 24 January 2023
- WORKING PAPER SERIES - No. 2766Details
- Abstract
- This paper provides an analysis of the impact of the COVID-19 pandemic on exporting firms, fo-cusing on the role of supply bottlenecks. Based on monthly transaction-level data for the universe of French exporters over the period January 2020-December 2021, we find that participation in global value chains increased firms’ vulnerability to the COVID-19 shock, in terms of both export perfor-mance and probability of survival in the export market, the negative impact of supply disruptions being higher for relatively more downstream firms. At the same time, the results suggest that export-ing firms benefited from sourcing of core inputs from different countries, supporting the hypothesis that diversification in global value chains fosters supply-chain resilience.
- JEL Code
- D22 : Microeconomics→Production and Organizations→Firm Behavior: Empirical Analysis
F14 : International Economics→Trade→Empirical Studies of Trade
F61 : International Economics→Economic Impacts of Globalization→Microeconomic Impacts
- 10 January 2023
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 8, 2022Details
- Abstract
- Headline inflation has increased sharply in the euro area and in the United States since the start of 2021. But there are major differences between inflation developments in these two economies. In particular, energy inflation has been much higher in the euro area – leading to higher headline inflation than in the United States in recent months. As the euro area is significantly more dependent on energy imports than the United States, the rise in energy prices constitutes a strong adverse terms-of-trade shock to euro area income. Amid the resulting relatively slower recovery from the pandemic in the euro area, the contribution of demand to core inflation has increased more gradually and later in the euro area than in the United States. In addition, the short-term outlook for economic growth is weaker in the euro area than in the United States and the US labour market is tighter, implying a relatively smaller impetus from economic activity and the labour market to inflation in the euro area. Looking ahead, professional forecasters expect inflation to be somewhat more persistent in the United States than in the euro area.
- JEL Code
- E31 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Price Level, Inflation, Deflation
E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
F4 : International Economics→Macroeconomic Aspects of International Trade and Finance
N10 : Economic History→Macroeconomics and Monetary Economics, Industrial Structure, Growth, Fluctuations→General, International, or Comparative
J3 : Labor and Demographic Economics→Wages, Compensation, and Labor Costs
- 20 September 2022
- WORKING PAPER SERIES - No. 2724Details
- Abstract
- This paper studies for the first time the links between interbank liability and equity markets (financial exposure), and mergers and acquisitions (M&As) in the European banking sector, both at the micro and macro level. Using a binary logit model, the paper first examines – at the micro level – how financial exposures between banks affect the probability of M&A. It finds that financial interlinkages significantly increase the chances of them taking place. Using a gravity model, the paper then investigates – at the macro level – whether the micro results hold. Not only do financial links are positively and significantly correlated with the number of M&As between countries, but they are also a better predictor than trade – traditionally used in the macro literature on M&A. Since the Capital Market Union would help to geographically diversify banks’ portfolio, it would therefore also foster cross-border M&As. Finally, the paper builds a M&A compatibility index for each pair of EU countries. The study highlights strong M&As prospects linked to high financial interlinkages in core Europe, which could be the sign of a future asymmetrical financial integration in the EU.
- JEL Code
- G21 : Financial Economics→Financial Institutions and Services→Banks, Depository Institutions, Micro Finance Institutions, Mortgages
G34 : Financial Economics→Corporate Finance and Governance→Mergers, Acquisitions, Restructuring, Corporate Governance
F21 : International Economics→International Factor Movements and International Business→International Investment, Long-Term Capital Movements
F34 : International Economics→International Finance→International Lending and Debt Problems
F36 : International Economics→International Finance→Financial Aspects of Economic Integration
- 30 June 2022
- WORKING PAPER SERIES - No. 2674Details
- Abstract
- This paper studies the bilateral drivers of mergers and acquisitions (M&As) between European banks. Two findings document that banks use M&A as a device to leverage their expertise rather than to diversify. (i) Following the literature on matrimonial matching by using a binary logit model, the paper examines how the structure of acquiring banks in terms of geographical location (headquarters and subsidiaries) influences the choice of targeted banks for an M&A transaction. It finds that banks favour domestic expansion over international diversification. (ii) The paper investigates how the business model of acquiring banks determines their selection of targeted banks. Very often, banks tend to target counterparts with the same business model or, to a lesser extent, those with the same business model as one of their subsidiaries.
- JEL Code
- G21 : Financial Economics→Financial Institutions and Services→Banks, Depository Institutions, Micro Finance Institutions, Mortgages
G34 : Financial Economics→Corporate Finance and Governance→Mergers, Acquisitions, Restructuring, Corporate Governance
L22 : Industrial Organization→Firm Objectives, Organization, and Behavior→Firm Organization and Market Structure
- 15 November 2021
- FINANCIAL STABILITY REVIEW - ARTICLEFinancial Stability Review Issue 2, 2021Details
- Abstract
- This special feature reviews recent trends in the consolidation of the euro area banking sector, examines the characteristics and drivers of bank M&A transactions, and analyses the impact of bank mergers and acquisitions on the performance of euro area banks. Bank mergers and acquisitions (M&As) have been subdued in the euro area since the global financial crisis. Most M&A activity has had a domestic focus and involved smaller targets, with larger and sounder acquirers acting as consolidators. Consolidation seems on average to have had a moderately positive impact on the profitability of the banks involved, although high levels of variance reveal the presence of large execution and design risks amid low overall returns on capital in the banking sector. Improved post-transaction profitability can be linked to targets’ lower cost efficiency, liquidity and capitalisation. Cross-border M&A transactions have been concentrated within a few small groups of euro area countries, supported by prior financial links and geographical proximity. Such transactions tend to be followed by a stronger improvement in profitability than domestic mergers, although this effect has diminished since the global financial crisis.
- JEL Code
- G21 : Financial Economics→Financial Institutions and Services→Banks, Depository Institutions, Micro Finance Institutions, Mortgages
G34 : Financial Economics→Corporate Finance and Governance→Mergers, Acquisitions, Restructuring, Corporate Governance
F36 : International Economics→International Finance→Financial Aspects of Economic Integration
- 12 October 2021
- OCCASIONAL PAPER SERIES - No. 283Details
- Abstract
- The consensus back in 2008 – ten years after the introduction of the euro – was that the adoption of a common currency had made a limited impact of around 2% in total on the trade flows of the first wave of euro area countries (Baldwin et al., 2008). Since then, six more countries have joined the euro area, and firms have internationalised their production processes. These two phenomena are interrelated and may have changed the way the common currency affects the euro area economy. Therefore, with the common currency now into its third decade – and with more countries queuing to adopt it – this paper revisits the trade effects of the euro, focusing on the newer euro adopters (i.e. those countries that have adopted the euro since 2007) and their interaction with the first wave of euro area members via supply chains. The contribution of the paper is twofold. First, it revisits the estimated aggregate impact of the euro on euro area trade, as well as on trade within and between the two waves of adopters. Data on bilateral flows between 1990 and 2015 for an extended sample of countries to estimate a gravity equation indicate a significant trade impact, ranging between 4.3% and 6.3% in total on average, with the magnitude being the highest for exports from the second wave of adopters to the first wave of adopters. If a synthetic control approach (Abadie and Gardeazabal, 2003; Abadie et al., 2010) is used instead, the estimated gains associated with euro adoption are greater. In particular, exports of both intermediate and final products from countries belonging to the first wave of euro adopters to those belonging to the second wave are estimated to have increased by about 30% using this approach. The second contribution made by this paper relates to the channels through which trade might be affected by a currency union. This question is explored by looking separately at trade in intermediate goods and final products. While we find that trade gains were mainly driven by trade in intermediate goods among countries that adopted the currency earlier (5.3%), our results also show that the euro had a positive effect on the exports of final products from the second wave of adopters to other euro area countries. This effect is as high as 10.6% with the gravity model and 32% with the synthetic control approach. One of the reasons for the difference in the range of estimates between the two approaches might be that the gravity model can control for unobserved characteristics via fixed effects, while the synthetic control approach may fail to do so. These results suggest that the euro facilitated the establishment and expansion of international production chains in Europe. In turn, this is likely to have increased business cycle synchronisation in the euro area and to have supported market access for later adopters.
- JEL Code
- F14 : International Economics→Trade→Empirical Studies of Trade
F15 : International Economics→Trade→Economic Integration
- 2022
- IMF Economic Review