The Seen and Unseen of COVID-19 Interventionism in France
An Austrian Economic Critique of Labor Market
DOI:
https://doi.org/10.30800/mises.2025.v13.1590Keywords:
Austrian School of Economics, COVID-19 pandemic, interventionism, Labor market, Wage subsidies, Misallocation of resources, Entrepreneurial discoveryAbstract
This article explores the economic consequences of the COVID-19 pandemic through the Austrian School of Economics lens, focusing on the labor market distortions caused by government interventions in France. While wage subsidies, furlough schemes, and other policies provided immediate relief, they masked deeper inefficiencies and delayed necessary market adjustments. Drawing on the insights of Bastiat, Hayek, Mises, Rothbard, and Kirzner, this study critiques the “seen” effects of these interventions—preserved jobs and stabilized incomes—while highlighting the “unseen” long-term consequences, including misallocation of resources, suppressed entrepreneurial discovery, and exacerbated deindustrialization. The article argues that by artificially maintaining employment in declining sectors and disrupting natural productivity cycles, these policies hindered the market’s ability to correct itself, thus prolonging economic recovery. Furthermore, retaining non-qualified workers without addressing structural labor market issues has entrenched inefficiencies and created a dependency on government support. The Austrian perspective offers a critical evaluation of how interventionism, though well-intentioned, may lead to prolonged economic stagnation and reduced overall market flexibility, underscoring the importance of allowing market signals and entrepreneurial activities to guide recovery efforts.
Downloads
Metrics
References
Bastiat, Frédéric. 1850. The Law.
Batut, Cyprien. 2022. « How Effective Was Remote Working for Managing the COVID-19 Pandemic? » Trésor-Economics, no 304 (mars). https://www.tresor.economie.gouv.fr/Articles.
Baum, Tom, et Nguyen Thi Thanh Hai. 2020. « Hospitality, tourism, human rights and the impact of COVID-19 ». International Journal of Contemporary Hospitality Management 32 (7): 2397‑2407.
Benitto, Hind, Benjamin Hadjibeyli, et Matéo Maadini. 2022. « Analysis of France’s State-Guaranteed Loan Scheme at End-2021 ». Trésor-Economics, no 303 (mars). https://www.tresor.economie.gouv.fr/Articles.
Blanchard, Olivier, et Lawrence F. Katz. 1997. « What we know and do not know about the natural rate of unemployment ». Journal of Economic Perspectives 11 (1): 51‑72.
Block, Walter. 2008. Labor economics from a free market perspective: Employing the unemployable. World Scientific. https://books.google.com/books?hl=fr&lr=&id=5yqPONCZHM0C&oi=fnd&pg=PR5&dq=Labor+Economics+from+a+Free+Market+Perspective:+Employing+the+Unemployable&ots=JsW3MVka2x&sig=fyPhyJEKG-UssK9U8bPntfRSHCM.
Borjas, George J. 2020. Labor Economics. 8th éd. New York: McGraw-Hill Education.
Bylund, Per L. 2015. The Seen, the Unseen, and the Unrealized: How Regulations Affect Our Everyday Lives. Ludwig von Mises Institute.
Cahuc, Pierre, Stéphane Carcillo, et André Zylberberg. 2014. Labor Economics. 2nd éd. Cambridge, MA: MIT Press.
Carraro, Carlo, Benoit Coeuré, Otilia Dhand, Barry Eichengreen, Melina Mills, Helene Rey, et Andre Sapir. 2022. « A New Era for Europe-How the European Union can make the most of its pandemic recovery, pursue sustainable growth, and promote global stability ». In A New Era for Europe. How the European Union Can Make the Most of its Pandemic Recovery, Pursue Sustainable Growth, and Promote Global Stability. Publication Office of the European Union. https://iris.unive.it/handle/10278/5014342.
Colbert, Carrie J. 2011. Telework as part of a business continuity strategy: A path toward organizational resilience. University of Maryland University College. https://search.proquest.com/openview/06d4fe098bcb85683ea3161c96d8b7c8/1?pq-origsite=gscholar&cbl=18750.
De Soto, Jesus Huerta. 2010. « The Austrian school: market order and entrepreneurial creativity ». Institute of Economic Affairs Monographs. https://papers.ssrn.com/sol3/Delivery.cfm?abstractid=3924227.
Ducoudré, Bruno. 2022. « Emploi et chômage avant et après Covid-19 ». In L ’économie française 2022, 48‑63.
Ettorre, Gabriele d’, Giancarlo Ceccarelli, Letizia Santinelli, Paolo Vassalini, Giuseppe Pietro Innocenti, Francesco Alessandri, Alexia E. Koukopoulos, Alessandro Russo, Gabriella d’Ettorre, et Lorenzo Tarsitani. 2021. « Post-traumatic stress symptoms in healthcare workers dealing with the COVID-19 pandemic: a systematic review ». International journal of environmental research and public health 18 (2): 601.
Fleetwood, Steve. 2007. « Austrian Economics and the Analysis of Labor Markets ». The Review of Austrian Economics 20 (4): 247‑67. https://doi.org/10.1007/s11138-006-0009-6.
Gentier, Antoine. 2021. « New crisis and old debates: The resurgence of the difficulties of the planned economy under COVID-19 ». Marche et organisations 41 (2): 35‑58.
Hayek, Friedrich A. 1945. « The Use of Knowledge in Society ». Modern understandings of liberty and property 35.
———. 1960. The Constitution of Liberty. Routledge.
Hoppe, Hans-Hermann. 1995. Economic science and the Austrian method. Ludwig von Mises Institute. https://books.google.fr/books?hl=fr&lr=&id=8JQ8nhL8bx0C&oi=fnd&pg=PA1&dq=hans+hermann+hoppe+methodology&ots=3s6Ffe7OOT&sig=Z8LpKS1JEeDFE5tviVCZ1QEW2Cc.
Hou, Jingbo, Chen Liang, Pei-Yu Chen, et Bin Gu. 2024. « Can Telework Adjustment Help Reduce Disaster-Induced Gender Inequality in Job Market Outcomes? » Information Systems Research 35 (4): 1701‑20. https://doi.org/10.1287/isre.2023.0241.
Ikeda, Sanford. 2002. Dynamics of the Mixed Economy: Toward a Theory of Interventionism. Dynamics of the Mixed Economy. Routledge.
Kapitsinis, N., A. Saroukou, G. Sykas, et D. Psarologos. 2021. « An overview of the Covid-19 effects on employment during 2020. Evidence from Cyprus, France, Spain, Greece, Italy, Malta, Croatia and Portugal ». orca.cardiff.ac.uk, juillet. https://doi.org/10.1016/j.worlddev.2020.105208.
Kathirvel, Natarajan. 2020. « Post COVID-19 pandemic mental health challenges ». Asian journal of psychiatry 53:102430.
Knicker, Max Sina, Karl Naumann-Woleske, Jean-Philippe Bouchaud, et Francesco Zamponi. 2025. « Post-COVID Inflation and the Monetary Policy Dilemma: An Agent-Based Scenario Analysis ». Journal of Economic Interaction and Coordination 20 (1): 141‑95. https://doi.org/10.1007/s11403-024-00413-3.
Landmann, Oliver. 2014. « Short-run macro after the crisis: The end of the’new’neoclassical synthesis? » https://www.econstor.eu/handle/10419/103951.
Lanssens, Camille. 2020. « La pandémie de Covid-19 sous le microscope des sciences sociales ». Droit et société.
Maadini, Matéo, et Benjamin Hadjibeyli. 2022. « Business Failures in France during the COVID-19 Crisis ». Trésor-Economics, no 298 (janvier). https://www.tresor.economie.gouv.fr/Articles.
Malliet, Paul, Frédéric Reynès, Gissela Landa, Meriem Hamdi-Cherif, et Aurélien Saussay. 2020. « Assessing Short-Term and Long-Term Economic and Environmental Effects of the COVID-19 Crisis in France ». Environmental and Resource Economics 76 (4): 867‑83. https://doi.org/10.1007/s10640-020-00488-z.
McKinlay, et al Pierce. 2020. « COVID-19 pandemic and its impact on social relationships and health ». Journal of Epidemiology & Community Health.
Mises, Ludwig von. 1929. A critique of interventionism. Ludwig von Mises Institute.
———. 1949. Human Action: A Treatise on Economics. Ludwig von Mises Institute.
———. 1998. Interventionism : an economic analysis. Foundation for Economic Education.
Mrozek, Michał. 2022. « Tourism Industry in France in Consideration of the COVID-19 Pandemic. Main Selected Issues ». Journal of Applied Economic Sciences (JAES) 17 (75): 67‑77.
Pennington, Mark. 2021. « Hayek on Complexity, Uncertainty and Pandemic Response ». Review of Austrian Economics 34:203‑20.
———. 2023. « Foucault and Hayek on Public Health and the Road to Serfdom ». Amara Journal of Public Health 195:125‑43.
Piacentini, Joe, Harley J. Frazis, Peter B. Meyer, Michael Schultz, et Leo Sveikauskas. 2022. The impact of COVID-19 on labor markets and inequality. US Department of Labor, US Bureau of Labor Statistics, Office of …. https://www.bls.gov/osmr/research-papers/2022/pdf/ec220060.pdf.
Plane, Mathieu, et Gaston Vermersch. 2024. « Inflation: Reemerging in France ». Revue d’economie financiere 153 (1): 99‑118.
Redbird, Beth, Laurel Harbridge-Yong, et Rachel Davis Mersey. 2020. « Social and Political Impact of the COVID-19 Pandemic: An Introduction ». Russel Sage Fundation.
Rothbard, Murray N. 1962. Man, Economy, and State with Power and Market. 2nd éd. Ludwig von Mises Institute.
———. 1963. America’s Great Depression. Ludwig von Mises Institute.
———. 1995. Classical Economics: An Austrian Perspective on the History of Economic Thought, Volume II. Cheltenham, UK: Edward Elgar Publishing. https://mises.org/library/classical-economics-austrian-perspective-history-economic-thought-volume-ii.
———. 2006. Making economic sense. Ludwig von Mises Institute.
———. 2011. Economic Controversies. Mises Institute.
Sanchious, Cheryl L. 2022. « An Examination of Managers’ View of Telework and Business Continuity: Utilization Level before and during the COVID-19 Pandemic ». PhD Thesis, Keiser University. https://search.proquest.com/openview/a5bb3f4e2f7adef127f87313c2e502c9/1?pq-origsite=gscholar&cbl=18750&diss=y.
Sémanne, Alexis. 2025a. « Beyond Piketty: Inequality, State Intervention, and the Distinction Between Naturally and Artificially Successful Entrepreneurs ». Journal of Libertarian Studies 29 (1): 26‑55.
———. 2025b. « Toward an Austro‐Libertarian Sociology ». The American Journal of Economics and Sociology, avril, ajes.12630. https://doi.org/10.1111/ajes.12630.
Uzawa, Hirofumi. 1974. « On the dynamic stability of economic growth: The neoclassical versus Keynesian approaches ». In Trade, Stability, and Macroeconomics, 523‑53. Elsevier. https://www.sciencedirect.com/science/article/pii/B978012356750550027X.
Williams, Colin C., et Aysegul Kayaoglu. 2020. « COVID-19 and Undeclared Work: Impacts and Policy Responses in Europe ». The Service Industries Journal 40 (13‑14): 914‑31. https://doi.org/10.1080/02642069.2020.1757073.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 MISES: Interdisciplinary Journal of Philosophy, Law and Economics
This work is licensed under a Creative Commons Attribution 4.0 International License.
This Journal is licensed under a Creative Commons Attribution 4.0 International License.
