Pavel Diev completed his thesis in 2007 at AMSE. At that time, he had already set out on his professional pathway within the Banque de France, where today he is Head of the International Monetary Relations Division.
CAN YOU DESCRIBE YOUR CAREER TRAJECTORY SINCE YOUR TIME AT AMSE?
I completed my PhD in 2007, under the supervision of Christophe Deissenberg. My thesis focused on efficient mechanisms for the provision of public goods. This topic combined both game theory and experimental economics.
I joined the Banque de France two years earlier, in end-2005. I had anticipated the end of my thesis and started prospecting in the professional world, with a career as an economist in view.
My very first position at the Banque de France was as an international economist in the Macroeconomic Analysis and Forecasting Division. I was in charge of monitoring several countries, particularly in Eastern Europe - Czech Republic, Poland, Ukraine, Russia. In the mid-2000s, there were a lot of investments in these countries, and some were in the process of integrating into the European Union. There was a strong demand for monitoring of macroeconomic indicators to coordinate policies.
I quickly moved into management positions. I became Head of Unit and then Deputy Head of the European Relations Division. The European Relations Division prepares meetings attended by the Governor of the Banque de France. I started by working on the Governing Council, where political and monetary decisions are made, in Frankfurt.
The Governing Council is composed of all the Governors of the member countries of the euro Newsletter area plus the members of the ECB’s executive board in Frankfurt.
I was immersed in the decision-making mechanics of European monetary policy by preparing the Governor’s positions. We briefed the Governor, prepared his talking points with the various experts from the Bank on the agenda topics, which change from meeting to meeting. A lot of meetings take place. What the public hears about are the «monetary councils», where interest rate and monetary policy decisions are made, often followed by a publicized press conference. But between these monetary councils, there are «nonmonetary councils» about twice a month that make all the other budgetary or administrative decisions that are not visible to the general public.
I was also Head of the Conjunctural Analysis and Forecasting Division, from 2018 to 2022. This division deals with monitoring and forecasting macroeconomic variables for France. It was a real challenge to make economic forecasts during the health crisis! There were supply chain disruptions everywhere, a third of the economy was shut down, so we first had to predict the GDP drop. Regular statistical reports were disrupted, and we relied heavily on qualitative contacts within the Banque de France’s regional business network or alternative indicators such as credit card payments data.
WHAT ARE YOU WORKING ON CURRENTLY?
I have been Head of the International Monetary Relations Division since 2022. I lead a small team of 14about ten people, mostly executives, economists. Some have PhDs, others have engineering degrees or attended grandes écoles. In my team, there is a young economist who is simultaneously preparing a thesis at AMSE, one of the few academic programs offering this «on-the-job» track.
The International Monetary Relations Division prepares the Governor of the Banque de France for G20 and G7 meetings. The meetings are less frequent than at the European level, and decisionmaking is less concrete. Finance ministers and Central Bank Governors participate in the «finance track» discussions. The final stage is meetings at the level of heads of state. These are forums for both political and economic coordination at the global level. Engagement is voluntary, and consensus is the rule.
Many discussions are about development financing and poverty reduction. For example, the Special Drawing Rights issued by the IMF after the Covid crisis and the options to channel them to the most vulnerable countries. Another example is a current discussion on global corporate taxation to avoid tax evasion. We are seeking an international agreement on a minimum tax of 15% on profits in all global jurisdictions.
Regarding the international situation of the Division, we work closely with the French Treasury and we have close contacts with the IMF. We brief the Governor to ensure the best outcome for France but also for the global common good in the spirit of multilateralism.
Another activity of the Division is monitoring ‘emerging markets’, which cover a very large, heterogeneous area. We particularly focus on the BRICS countries. Forecasting for France requires knowing the international environment in which the country operates; this is called foreign demand. Observing the trajectory of oil prices or exchange rates is crucial for forecasting inflation, for example.
HOW DO YOU FEEL ABOUT YOUR TIME AT AMSE?
I did the Magistère, of which I have very fond memories. We worked on projects together with other students. This collaborative work prepares you for the professional environment, where you never work alone but always as part of a team.
The doctorate is a more solitary undertaking, but it developed my critical thinking. This is very useful in the professional world, both to promote one’s own work and to challenge the work of others.
I remember receiving high-level education in a stimulating environment. I had remarkable professors. In econometrics, I remember Russell Davidson’s course. I also remember Alan Kirman’s course, where he used ants to explain how financial markets work - offbeat explanations that remain with me today.
→ This article was issued in AMSE Newletter, Winter 2023.
