April 23 is the first round of the French Presidential election. As with many recent elections, there is an intense interest in the outcome, especially with Le Pen as a contender and with Trump and Brexit still making daily headlines.

Observers and analysts have pointed out that attitudes towards globalization and immigration were important in determining the inward-looking outcome of the British referendum. Yet, arguments against international integration and in favor of restricting the number of refugees were defining issues in two other European elections, those in Austria and the Netherlands.

What can data from the IMD World Competitive Yearbook tell us about recent elections and the upcoming one in France? This month we compare two indicators from the Executive Opinion Survey as well as the evolution of the economic performance of Austria, the Netherlands and the United Kingdom, all of which have held major votes in the past year. We also take a look at inequality via data on the difference between CEO to personal assistant remuneration. We contrast three years: 2006, which stands as an indicator for the period before the financial meltdown, 2012, a year during the recovery period, and 2015, the most recent year with full data for the above factors.

The below graph shows a telling story.

The criterion “Immigration laws” gives us an idea of how open an economy is perceived to be. The segment of the population that responded to the survey felt that the economy in the Netherlands is more open to foreign labor, in Austria it did not see any change, while in the UK it felt that the economy is less open… France, on the other hand, experienced a slight increase with respect to appealing to foreign labor.

The narrative is similar if we examine the criterion that depicts attitudes toward globalization. The sentiment towards international integration rose in the Netherlands, increased slightly over the last three years in the UK, while it declined in Austria. In France the positive attitude toward globalization has been increasing in all of the years considered.

Given that the elections provided an inward-focusing outcome in the UK and an outward-focusing result in Austria and the Netherlands, the above indicators don’t provide us with a full enough picture to predict what will happen in France.

However, if we look at income inequality, a dimension that has been suggested as a contributing factor to the outcome of the elections, we observe a different perspective. Comparing the remuneration spread for the years 2006 and 2015 we detect that both Austria and the Netherlands exhibit a similar spread. The trend is different in the UK. The spread increased substantially between the years 2006 and 2015. In the French economy this criterion clearly follows a similar trajectory as in the UK.

Does the above imply that the outcome of the French election will be an inward-focusing result as well? Not so fast! There is an alarming similarity between the evolution of the remuneration criterion in France and UK. Yet, the final outcome of an election is complex and cannot be captured by a single variable. However, what this simple comparison underlies is the need for more action on income inequality.

With best regards,

Christos Cabolis