French Family Values...

http://www.nytimes.com/2005/07/29/op...rugman.html?hp

July 29, 2005

French Family Values

By PAUL KRUGMAN

"Americans tend to believe that we do everything better than anyone else.
That belief makes it hard for us to learn from others. For example, I've
found that many people refuse to believe that Europe has anything to teach
us about health care policy. After all, they say, how can Europeans be good
at health care when their economies are such failures?

Now, there's no reason a country can't have both an excellent health care
system and a troubled economy (or vice versa). But are European economies
really doing that badly?

The answer is no. Americans are doing a lot of strutting these days, but a
head-to-head comparison between the economies of the United States and
Europe - France, in particular - shows that the big difference is in
priorities, not performance. We're talking about two highly productive
societies that have made a different tradeoff between work and family time.
And there's a lot to be said for the French choice.

First things first: given all the bad-mouthing the French receive, you may
be surprised that I describe their society as "productive." Yet according to
the Organization for Economic Cooperation and Development, productivity in
France - G.D.P. per hour worked - is actually a bit higher than in the
United States.

It's true that France's G.D.P. per person is well below that of the United
States. But that's because French workers spend more time with their
families.

O.K., I'm oversimplifying a bit. There are several reasons why the French
put in fewer hours of work per capita than we do. One is that some of the
French would like to work, but can't: France's unemployment rate, which
tends to run about four percentage points higher than the U.S. rate, is a
real problem. Another is that many French citizens retire early. But the
main story is that full-time French workers work shorter weeks and take more
vacations than full-time American workers.

The point is that to the extent that the French have less income than we do,
it's mainly a matter of choice. And to see the consequences of that choice,
let's ask how the situation of a typical middle-class family in France
compares with that of its American counterpart.

The French family, without question, has lower disposable income. This
translates into lower personal consumption: a smaller car, a smaller house,
less eating out.

But there are compensations for this lower level of consumption. Because
French schools are good across the country, the French family doesn't have
to worry as much about getting its children into a good school district. Nor
does the French family, with guaranteed access to excellent health care,
have to worry about losing health insurance or being driven into bankruptcy
by medical bills.

Perhaps even more important, however, the members of that French family are
compensated for their lower income with much more time together. Fully
employed French workers average about seven weeks of paid vacation a year.
In America, that figure is less than four.

So which society has made the better choice?

I've been looking at a new study of international differences in working
hours by Alberto Alesina and Edward Glaeser, at Harvard, and Bruce
Sacerdote, at Dartmouth. The study's main point is that differences in
government regulations, rather than culture (or taxes), explain why
Europeans work less than Americans.

But the study also suggests that in this case, government regulations
actually allow people to make a desirable tradeoff - to modestly lower
income in return for more time with friends and family - the kind of deal an
individual would find hard to negotiate. The authors write: "It is hard to
obtain more vacation for yourself from your employer and even harder, if you
do, to coordinate with all your friends to get the same deal and go on
vacation together."

And they even offer some statistical evidence that working fewer hours makes
Europeans happier, despite the loss of potential income.

It's not a definitive result, and as they note, the whole subject is
"politically charged." But let me make an observation: some of that
political charge seems to have the wrong sign.

American conservatives despise European welfare states like France. Yet many
of them stress the importance of "family values." And whatever else you may
say about French economic policies, they seem extremely supportive of the
family as an institution. Senator Rick Santorum, are you reading this?"

/