Do economists hold power? The role of economists in the French railway market liberalization (1970-2011)

Our paper focuses on the liberalization of the French railway sector. We argue that the social construction of a free market was not created from scratch but, on the contrary, was anticipated decades ago. In this respect, we seek to determine the specific role of economists with regard to the introduction of competition and its implementation methods.

            One example out of many is the impact of Maurice Allais' theory of social return, which was supposed to embody the public interest. His principles had a great influence on the reorganization of the national state-owned company SNCF in a commercial direction in the 1970s, resulting in the development of subsidiaries that compete with each other, the creation of a marketing department, the introduction of price discrimination, etc. Additionally, the theory of contestable markets developed by William Baumol had a significant impact the separation between infrastructure operators and railway companies in order to encourage market openness. Nowadays, the work of Jean Tirole is particularly influential.

            However, recent studies on the real interface between economic research and public decision-making prompt us to reconsider the role of performativity of economics. Does the French transport policy always follow the advice of economists, or does this only happen when their recommendations are consistent with the state's strategy? We believe that it is a mix of both and the purpose of our communication is also to show precisely by which mechanisms the economists involved in the debate can influence the future of the railway (e.g. through the « grands corps d’Etat », think tanks, lobbies, etc.).

            We finally emphasize that an increasingly economic and financial approach of the railway sector can be a powerful mechanism used by technocrats to discourage the other stakeholders, such as the railway workers, unions and transport users, from being a part of the debate.