Post Hoc Ergo Propter Hoc
During the debate on the French Presidential elections, one contender has presented a graph showing a divergence between industrial production in Germany on one side and in France, in Spain and in Italy on the other. For Marine Le Pen the Eurozone was the explanation. There is a divergence but that’s not that simple.
Later in the debate, Le Pen said that the UK performance was exceptional compared to France. One reason was the capacity for the UK to manage its currency.
The temptation is strong to show a graph with industrial production in France and in the United Kingdom. I did it with indices rebased at 100 in 1999 (Eurozone inception)
Profiles are the same. It means that the explanation related to the Euro is not relevant as UK doesn’t have the Euro as a currency.
The profile of the French economy cannot be read only by its membership of the Euro Area. This issue is more complex than a sentence in a debate. The economy is not as simplistic as some wants to present it.