Thibault Lemaire

Economist at the IMF (African Department), PhD from Université Paris 1 Panthéon - Sorbonne, former Research fellow at Banque de France.

Fields of interest

Monetary and fiscal policy, open macroeconomics, informality, economics of climate change, developing countries.

Publications

Civil Conflicts and Exchange Rate Misalignment: Evidence from MENA and Arab League Members, Review of Middle East Economics and Finance, 19 (2), 101-130.

Financial Inclusion and International Migration in a Context of Climate Instability, with Maëlan Le Goff (2022), Revue d’économie du développement 31 (2), 211-217.

Working Papers

International Commodity Prices Transmission to Consumer Prices in Africa, Banque de France Working Paper 906, with Paul Vertier (February 2023).

Abstract: Global commodity prices spikes can have strong macroeconomic effects, particularly in developing countries. This paper estimates the global commodity prices pass-through to consumer price inflation in Africa. Our sample includes monthly data for 48 countries over the period 2002m02-2021m04. We consider 17 commodity prices separately to take into account both the heterogeneity in price variations and the cross-correlations between them, and to depart from aggregate indices that use weights unrepresentative of consumption in African countries. Using local projections in a panel dataset, we find a maximum pass-through of 24%, and a long-run (18 months) pass-through of about 20%, higher than usually found in the literature, which typically uses aggregate indices. We also consider country-specific regressions to test whether estimated pass-through are related to countries’ observable characteristics. We find evidence that the pass-through is negatively correlated with the GDP per capita and the quality of transport infrastructure, and positively correlated with the share of food and energy in the consumption basket and the share of taxes on goods and services in government revenue. Net oil exporters, countries with larger energy subsidies and with a more independent central bank tend to have a lower pass-through. We further show that commodity-specific pass-through are correlated with the share of corresponding goods in the consumer basket.

Keywords: Commodity prices, food prices, energy prices, inflation, pass-through, Africa.

JEL classification: C23, E31, F44, O11, Q02.

Ferdi Working Paper Version: Ferdi WP 314

Drought and Growth in Arab League Members, Iran and Turkey, ERF Working Paper No. 1578 (September 2022).

Abstract: Water scarcity and droughts have long characterized the Middle East and North Africa, and climate change represents an additional challenge to this region’s development prospects. Using macroeconomic and climate panel data for Arab League members, Iran and Turkey during the period 1960–2018, this paper assesses the effects of sustained drought deviations from their historical norms on output growth in the region and shows that droughts decrease output growth in oil importing countries, with no or statistically weakly significant positive effects in oil exporting countries. These effects do not strengthen as the horizon increases and vanish after one year but do not revert in subsequent periods, leading to lasting losses in output level in oil importing countries. The agricultural sector and civil violence appear to be two of the transmission channels. The results advocate for carefully planned economic diversification in the region and shed light to associated risks.

Keywords: Climate Change, Drought, Economic Growth, Business Fluctuations, Developing Countries, Middle East and North Africa.

JEL Classification: E32, O11, O13, O40, Q54

Climate Change in Developing Countries: Global Warming Effects, Transmission Channels and Adaptation Policies, Banque de France Working Paper 822, with Olivier de Bandt and Luc Jacolin (July 2021).

Abstract: Using panel data covering 126 low-and middle-income countries over 1960-2017, we find that sustained positive temperature deviations from their historical norms have a non-linear negative effect on economic growth and growth per capita. A sustained 1°C temperature increase lowers real GDP per capita annual growth by 0.74–1.52 percentage points, irrespective of levels of development. We also find that temperature rise affects the households’ intertemporal trade-off between consumption and investment, since the share of private consumption in total value-added increases while the share of investment declines. A sectoral decomposition shows that the share of industrial value-added also declines. While the share of agricultural value-added increases, agricultural output and productivity declines. Taken together, our results suggest that global warming will reinforce development traps, hindering further adaptation to climate change, particularly in the countries with the lowest levels of income given their lower resilience and higher socioeconomic vulnerability.

Keywords: Climate Change, Economic Growth, Adaptation, Developing Countries.

JEL Classification: C33, E20, O11, O13, Q54

Civil Conflicts and Exchange Rate Misalignment: Evidence from MENA and Arab League Members, ERF Working Paper No. 1495 (October 2021).

Abstract: For more than a decade, civil conflicts intensity has been high in the Middle East and North Africa, yet the monetary and financial impacts of such episodes have received relatively little attention. Using macroeconomic and conflict panel data for Arab League members, Iran and Turkey during the period 1970–2018, this paper constructs a country-specific real exchange rate misalignment index and adopts an instrumental variable approach to show that civil conflicts lead to real exchange rate overvaluations in the region: a 1 unit increase in civil conflict intensity leads to a 0.24 unit increase in the RER misalignment index. Economic policy during post-conflict transitions should be elaborated based on a strategy to realign the currency in order to prevent further macroeconomic imbalances and foster social stability, economic growth and long-term development.

Keywords: Exchange Rate Misalignment, Civil Conflict, Middle East & North Africa, Emerging and Developing Countries.

JEL Classification: C23, D74, E32, F31, F41

Fiscal Consolidations and Informality in Latin America and the Caribbean, Documents de travail du Centre d’Économie de la Sorbonne 2020.04 (January 2020).

Abstract: The transmission mechanisms of fiscal policy are significantly affected by informality in the labour market. Extending a narrative database of fiscal consolidations in 14 countries from Latin America and the Caribbean between 1989 and 2016 in order to account for heterogeneity in terms of commitment to the reforms, I show that tax-based and spending-based multipliers are both recessionary and do not significantly differ one from another in this region. Furthermore, these multipliers decline in absolute value as the level of labour informality increases in the economy, although evidences are less robust for spending-based consolidations. An analysis of the effects of tax-based consolidations on private demand suggests that labour market informality constitutes a short-term social buffer that attenuates the contractionary effects of this type of policy by increasing investment opportunities through tax evasion and entrepreneurial alternatives to unemployment for dismissed workers

Keywords: Fiscal consolidation, taxation, informality, emerging market economies.

JEL Classification: E62, E26, E32, H5, H6.

CES Working Paper Version: CESWP 2020.04

Banque de France Working Paper Version: BdFWP #764

Power Sector Reforms and Technological Change: Evidence from Arab League Members, ERF Working Paper No. 1423, with Dina Ragab (November 2020).

Abstract: Power sector reforms have been widely adopted in the turn of the 21st Century, including in the Middle East and North Africa. Have the promises that accompany such reforms led to technological change in the region? Adopting an instrumental variable approach and using an index of power sector reforms and aggregate macroeconomic data for 18 Arab League member states between 1982 and 2013, we provide robust evidence that there is a positive causal relationship between power sector reforms and technological change, proxied by high-tech exports, in Arab countries. While the literature has evidenced a relationship between such reforms and economic growth, our results suggest that technological change is a transmission channel of this relationship.

Keywords: Power Sector Reforms, Industrialization, Technological Change, Arab Countries.

JEL Classification: F14, L50, O14, O38

Phillips in A Revolution: Unemployment and Prices in Early 21st Century Egypt, ERF Working Paper No. 1453 (December 2020).

Abstract: The relative price Phillips curve hypothesis gives a better account of the dynamics of the Egyptian economy than the price Phillips curve. Using standard aggregate macroeconomic quarterly data for the Egyptian economy from 2003q1 to 2019q1 to obtain Ordinary Least Squares and Generalized Method of Moments estimates for four versions of the Phillips curve, this article provides evidence that the exchange rate regime affects the relation between prices and unemployment in emerging economies: while an economic boom leads to lower unemployment and higher inflation in a fixed exchange rate regime, the nominal appreciation of the currency negatively affects imported goods prices and flattens the price Phillips curve in a flexible exchange rate regime. The results also suggest a broken link between inflation and unemployment during the Egyptian Revolution and the subsequent period, raising questions on macroeconomic management in times of political turmoil.

Keywords: Phillips Curve, Egyptian Economy, Labour Market, Monetary Policy, Small Open Economy.

JEL Classification: E24, E31, E52, E58, F31

Work in Progress

Climate-Related Natural Disasters and Exchange Rate Misalignment in Developing Countries.

Climate Variability and International Migrations From Low-Income Countries: Does Financial Inclusion Matter?, with Maëlan Le Goff.

Climate-Related Natural Disasters and Financial Stability in Developing Countries, with Vincent Fleuriet.

A Small Open Economy Model: Assessing the Role of Monetary Policy in Egypt.

Conferences:

  • 2023 CSAE Conference, Oxford (forthcoming).
  • 2nd Annual Central Bank Conference on Development Economics in the MENA region, Riyadh.
  • Frontiers of Climate and Nature in Macroeconomics and Finance, Banque de France & NGFS.
  • The Economics of Informality Conference 2022, Bogota.
  • 38th International Symposium on Money, Banking and Finance, Strasbourg.
  • 2022 International Conference on Development Economics (ICDE)*, Clermont-Ferrand.
  • ERF 28th Annual Conference, Cairo.
  • ERF 27th Annual Conference, Cairo.
  • Pacific Conference for Development Economics (PacDev) 2021, UC San Diego (CA).
  • ADRES Doctoral Conference 2021, Strasbourg.
  • ERF 26th Annual Conference, Luxor.
  • 3rd Research Conference on Macroeconomic Modelling and Model Comparison, CEPR Network, Frankfurt.
  • ERF 25th Annual Conference, Kuwait City.

Research Seminars:

  • 2nd Lille-Reading Workshop on International Finance “Tensions within Globalisation”, Online (Lille - Reading universities).
  • 8th Research Workshop, Cairo University - Université Paris 1 Panthéon - Sorbonne, Cairo.
  • DGSEI Seminar, Banque de France, Paris.
  • Development Economics Sorbonne Internal Research Seminar, Université Paris 1 Panthéon - Sorbonne, Paris.
  • Banque de France - FERDI Seminar, Paris.
  • Development Economics Sorbonne Internal Research Seminar, Université Paris 1 Panthéon - Sorbonne, Paris.
  • IBFI’s Green Finance Training Seminar, Banque de France, Paris.
  • Banque de France - FERDI Seminar, Paris.
  • IBFI’s Green Finance Training Seminar, Banque de France, Paris.
  • DGSEI Seminar, Banque de France, Paris.
  • Brown Bag Seminar, Agence française de développement (AFD), Paris.
  • 2nd “Emerging Market MacroEconomics” Workshop, Universities of Bordeaux and Poitiers.
  • Development Economics Sorbonne Internal Research Seminar, Université Paris 1 Panthéon - Sorbonne, Paris.
  • PhD Seminar, Banque de France, Paris
  • Development Economics Sorbonne Internal Research Seminar, Université Paris 1 Panthéon - Sorbonne, Paris.
  • 16th Doctorissimes, Doctoral School of Economics Panthéon - Sorbonne, Paris.
  • 7th Research Workshop, Cairo University - Université Paris 1 Panthéon - Sorbonne, Cairo.