François Villeroy de Galhau: Europe's growth gap - reconciling Keynes and Schumpeter

High-level lecture by Mr François Villeroy de Galhau, Governor of the Bank of France, at the College of Europe, 31 March 2021.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Dear students, Professors, Ladies and Gentlemen,

I am delighted to be with you today, and I extend my warmest thanks to Professor Béatrice Dumont for her kind welcome speech. For obvious and unfortunate reasons, I was unable to come physically to the magnificent city of Bruges, this architectural jewel of the Middle Ages. Bruges is also a highly significant place for a central banker, as it was the birthplace of stock markets in Europe, in the 14th century.

I also stand before you as a committed European, born and raised at the Franco-German border, present in Maastricht 30 years ago, and the College of Europe reflects this fruitful European spirit that I particularly cherish. What I want to do today is to avoid "langue de bois". In these troubled times, we need to speak "truthfully" before acting positively. In this respect, I would like to address the following issue: why is Europe lagging economically behind the United States? In order to find the right cure, we first have to elaborate on the right diagnosis.