5. French capitalism

Question 1

What are the key phases of French capitalism?

Answer 1

• State Capitalism (1815–1944): The government controlled much of the economy.
• Planned Capitalism (1945–1982): The government planned and managed the economy.
• Capitalism in Transition (1983–now): Shift to less government control and more market focus.

Question 2

What challenges does France face with high public spending? (56% of GDP)

Answer 2

Positive: Boosts income and infrastructure.

Negative: Crowds out private spending, raises inflation, deters investors.

Question 3

What are the effects of France’s high debt and deficits?

Answer 3

• France debt is above EU rules, which can hurt the stability in the Eurozone.

France needs to:
- Spend less money.
- Encouraging businesses grow.
- Make it easier for companies to succeed

Question 4

What is the French Growth Model?

Answer 4

Mixed economy
- The government plays a big role in spending and social programs.
- Businesses and markets also have freedom to grow.

Question 5

In france perspective what are the pros and cons of France leaving the Euro/EU?

Answer 5

Pros: Regain control of money and policies.

Cons: Trade barriers, less investment, unstable markets.