FRANCE'S POOR ECONOMY

TCS Daily Column, Au Revoir, Les Entrepreneurs, explores some of the data and experience on weak and collectivist France's economy:

"In 2002 the French lost more than twice as many weeks per worker due to sick leave compared to the US and a recent study by US and European researchers found that the wage and benefits returns to long-term employees in France has since 1976 been consistently lower than in the US. According to the "Global Entrepreneurship Report 2000" the percentage of those who were starting new businesses was five times higher in the US compared to France.
The problem is not only that the French economy punishes the very rich, discouraging them from working and creating businesses - but that it does the same for those with low incomes. The French welfare state creates a high "unemployment trap" for low-wage earners.
An unemployment trap is a measure of the percentage of gross earnings which is "taxed away", through social security contributions, higher tax and withdrawal of government benefits, when a person returns to employment. The calculations are based on a single person without child who earns 67 percent of the average earning of a full-time productions worker in the manufacturing industry. In France the unemployment trap corresponds to around 82 percent - creating a very small economic incentive for low income workers to actually go to work."