October 2012 - Renaud Foucart

Renaud Foucart
renaud.foucart@economics.ox.ac.uk
Birthdate: October 9, 1984
http://rfoucart.wordpress.com
+447429076896
Education
Nuffield College and Dept. Of Economics
Oxford University
New Road, OX1, 1NF
Oxford, United Kingdom
Postdoctoral research fellow, Nuffield College, University of Oxford
Curriculum Vitae (October 2012)
2012: Ph.D. In Economics at Ecares, Université Libre de Bruxelles, under the supervision of
Micael Castanheira and Patrick Legros
2008: Master in Economics at ECARES (Université Libre de Bruxelles)
2006: Bachelor in Economics (Université Libre de Bruxelles)
2005: Bachelor in Political Science (Université Libre de Bruxelles)
Other: Visiting PhD Student at the Toulouse School of Economics (Spring 2011). Short visiting
to Cornell University and Université du Luxembourg. Exchange Programme (Erasmus) at
Universidad de Zaragoza (Spain).
Professional Experience
Teaching
Languages
• Teaching assistant at Université libre de Bruxelles (2006-2012), in
various fields such as Introductory Microeconomics (profs. Micael
Castanheira and Mathias Dewatripont), Introductory Macroeconomics (prof.
Pierre-Guillaume Méon), Public Economics (prof. Françoise Thys-Clément
and Antonio Estache) and Graduate Microeconomics II (prof. Patrick Legros
and Julio Davilà)
• Coordination of exercise sessions (2006-2012) in Public Economics,
Economics of regulation and Introductory Microeconomics.
Others • Part time consultant for the World Bank (2011-2012)
• Part time consultant for the research center in Political Science
(CEVIPOL-ULB) during Belgian election days (2010-20..)
• Academic Coordinator for students exchange programmes in economics
(SOCRATES and ERASMUS) (2006-2009)
French: Excellent
English: Good (written and spoken)
Dutch: Good (written and spoken)
Spanish: Good (spoken) and average (written)

Presentations and Conferences
• “On goods and Premises” (under various titles):
◦ University of Mannheim (February 2012), University of Edinburgh (February 2012),
CORE, Université Catholique de Louvain (January 2012), XXXVIth Meeting of the
Spanish Association of Economics (SAEe), Malaga (December 2011), Queen's
University, Belfast (December 2011), Universidad del Pacifico, Lima (December 2011),
European Winter Meeting of the Econometric Society, Tel-Aviv (October 2011),
University of Mannheim (September 2011), EARIE 2011, Stockholm (September 2011),
10th “Journées Louis-André Gérard-Varet”, Institut d'Economie Publique, Marseille (June
2011), ECORE summer school, Louvain La Neuve (May 2011), Doctoral Meeting of
Montpellier (April 2011), ENTER Jamboree at University of Tilburg (February 2011),
ECARES, Université Libre de Bruxelles (November 2010), Doctoral Workshop,
Université Catholique de Louvain (June 2010).
• “Modal Choice and Optimal Congestion” (with Quentin David, under various titles):
◦ Toulouse School of Economics (March 2011), Association for Public Economic Theory
(PET10), Istanbul (Bogaziçi University) (June 2010), 9th “Journées Louis-André Gérard-
Varet”, Institut d'Economie Publique, Marseille (June 2010), ECARES, Université Libre
de Bruxelles (February 2009).
• “A tale of market failure, with an application to smoking bans in bars and restaurants”
(under various titles)
◦ 8th “Journées Louis-André Gérard-Varet”, Institut d'Economie Publique, Marseille (June
2009), ECORE summer school, Brussels (May 2009).
Other: Young researcher selected for the Lindau Nobel Meeting (August 2011). Discussant, ENTER
JAMBOREE at Toulouse School of Economics (February 2010).
Working Papers
1. On goods and premises [ECARES working paper #2012-24]
Abstract:
I show how a market where all sellers share the same information can display price dispersion:
identical goods sold at different prices by different sellers. This happens when goods are sold on
premises of the same quality, but corresponding to different tastes. In the presence of such price
dispersion, a share of the buyers may actually search, but the market remains inefficient at matching
buyers with the right premises. This market failure is independent of search costs, even when they
become arbitrarily small.
2. A tale of market failure, with an application to smoking bans in bars and restaurants [latest
version available on rfoucart.wordpress.com]
Abstract:
Market competition should induce producers to meet consumer demand. Yet, markets often fail to
achieve this outcome. A case in point is the one of bars and restaurant that failed to follow the
increasing demand for non-smoking environments. This paper shows that the existence of
heterogeneous tastes and non-transferable utility on the demand side is sufficient to produce
significant market failures even when competition is essentially perfect. Under fairly general
conditions, the market outcome is such that producers oversupply the product preferred by a minority
of consumers, forcing the majority to consume goods they value less. The reason for this equilibrium
outcome is that groups of consumers with heterogeneous tastes stop buying when the market provides
additional product diversity, thereby reducing aggregate demand. The best policy in terms of
aggregate welfare is either to constrain suppliers to only supply the good demanded by the majority -a
total smoking ban- or to only grant a very small number of licenses for the other product -restricted
smoking licenses. However, no policy intervention can be Pareto improving.

3. Modal Choice and Optimal Congestion (with Quentin David) [CREA discussion paper
#2012-3]
Abstract:
We study the choice of transportation modes within a city where commuters have heterogeneous
preferences for a car. As in standard models of externalities, the market outcome never maximizes
aggregate welfare. We show that in the presence of multiple equilibria problems of coordination can
worsen this result. Hence, a social planner focusing on the marginal impact of policies may miss the
largest source of inefficiency. We discuss two policy tools: taxation and traffic separation (e.g.
exclusive lanes for public transportation). Setting the optimal levels of taxation and of traffic
separation constitutes a necessary but not a sufficient condition to reach the first best equilibrium.
Comparing the relative efficiency of both policies, we show that traffic separation should be preferred
for large-scale policies while taxation better applies to marginal modifications of commuting patterns.
4. Treshold Effects in Self-Enforcing International Environmental Agreements (with
Grégoire Garsous) [latest version available on rfoucart.wordpress.com]
Abstract:
A large literature predicts that self-enforcing International Environmental Agreements (IEAs) cannot
help much to solve global environmental problems. In particular, the number of signatories is
decreasing as environmental concerns are growing. We show that this counter-intuitive result does not
hold in the presence of a well-documented threshold implying irreversible damages to the
environment. Scientific uncertainty is then found to be the main barrier to the formation of IEAs.
5. Horizontal skills mismatch in the labor market: Protecting the past vs. protecting the
future (with Antonio Estache) [ECARES Working Paper #2012-030]
Abstract:
This paper shows how high bargaining power for firms and search costs in the labor market can
impede a switch towards new, more competitive economic activities. This is because search costs
drive the quality of the horizontal matching between worker types and the old and new sectors of the
economy. The high bargaining power of firms pushes wages down, so that small search costs are
enough for young workers or workers with new skills to give up looking for jobs in the new sector.
Employers end up giving up offering these jobs as well. Politically popular labor policies protecting a
dominating old sector and old workers, fail to address the mismatches and increase unemployment.
Simply switching support to the new sector may cut jobs for the older workers and thus create other
welfare losses. A more effective modernization policy, for both jobs and products, is to link wages to
output.
Other papers
6. Job creation through infrastructure investment in the Middle East and North Africa
(with Elena Ianchovichina, Antonio Estache, Grégoire Garsous and Tito Yepes) [World Bank
Policy Research Paper #6164]
Dispersion des prix et efficacité des marchés compétitifs, Reflets et perspectives de la vie
économique, 2012/3, pp,17-27, De Boeck
Une typologie des résultats électoraux basée sur le comportement des électeurs volatiles en
Belgique (with Marjorie Gassner and Emilie Van Haute), Cahiers du CEVIPOL, 2012/3, Université
Libre de Bruxelles
In the press: I had interviews and op-ed published in De Standaard (main Dutch Speaking
Newspaper in Belgium), Le Soir (main French Speaking Newspaper in Belgium), L'Echo (main
French Speaking Financial and Economic Newspaper in Belgium), and Alter-échos.

References
Prof. Micael CASTANHEIRA
ECARES Université Libre de Bruxelles, CP114
Av. F.D. Roosevelt, 50 B-1050
Brussels Belgium
Tel +32 (0) 2 650 4467
e-mail : mcasta@ulb.ac.be
Prof. Patrick LEGROS
ECARES Université Libre de Bruxelles, CP114
Av. F.D. Roosevelt, 50 B-1050
Brussels Belgium
Tel +32 (0) 2 650 4219
e-mail : plegros@ulb.ac.be
Prof. Antonio ESTACHE
ECARES Université Libre de Bruxelles, CP114
Av. F.D. Roosevelt, 50 B-1050
Brussels Belgium
Tel +32 (0) 2 650 4319
e-mail : aestache@ulb.ac.be