During the spring of 1978, a young researcher fresh from a Harvard PhD had the idea to create a high-level centre of economic research in his hometown, Toulouse. His name was Jean-Jacques Laffont. In 1979, he returned to Toulouse and laid the foundations for what would become the Toulouse School of Economics.
“Toulouse is my America” Jean-Jacques Laffont
Laffont was motivated by his passion for research and contributed tremendously to economic science with more than 200 scientific articles and 17 books.
In 1981, he created the GREMAQ, a laboratory of research in mathematical and quantitative economics. This is a joint undertaking of University of Toulouse 1 Capitole, the EHESS, the CNRS and the INRA. A lot of events were created in the GREMAQ: seminars, partnerships, collaborations, and exchanges with other centres of research, and they improved the international visibility of Toulouse.
In 1990, the Institute of Industrial Organization (French: Institut d’Economie Industrielle, IDEI) was created. It is a partnership-based research centre which aims to provide answers to economic questions asked by businesses and public bodies. For these institutes, Jean-Jacques Laffont found many partnerships, including with companies such as La Poste, France Télécom, and EDF.
Two other centres of research were created: the ARQADE in 1997 which specialises in development economics, and LERNA in 1999 which focuses on natural economic resources.
Jean-Jacques Laffont did not neglect the educational part. He created the Magistère of Economics and Statistics in partnership with the University of Toulouse Paul Sabatier. He was inspired by the American system to create DEEQA, an academic degree for the first year of the PhD degree. It helps to specialise PhD students after their Master’s degree.
Many high-level researchers joined Laffont in Toulouse. It was the case of Jean Tirole who joined him in 1991 after working as an MIT professor for seven years, where he earned his PhD in 1981. Jean Tirole and Jean-Jacques Laffont shared the same approach to economics: more rigorous and more mathematics based than traditional French economics.
Unfortunately, in 2004, Jean-Jacques Laffont passed away from cancer. Suddenly, there was a risk that the ambitious project he had imagined would come to a halt. However, thanks to the team he had put together, his project was finally realised.
2006 : Creation of the Advanced Research Thematic Network (RTRA) “Toulouse School of Economics”
In 2006, the French State was looking for projects to create networks of high-quality research. The project in Toulouse was selected and it benefited from a financial contribution of 12,8 million euros in addition to 0,8 million euros from the founding establishments. Later, in 2008, Jean Tirole and Christian Gollier raised an additional 33 million euros in private funds.
2011 : establishing “Toulouse School of Economics”
In September 2011, University of Toulouse 1 Capitole and TSE set up the Toulouse School of Economics. It was granted 25 million euros to develop the research. In 2012, TSE earned two new labels from the French education system: Initiative d’Excellence (IDEX) and Initiatives d’Excellence en Formations Innovantes (IDEFI). These assignments helped the financial development of the school.
2014 : Jean Tirole, Nobel Prize in Economics
Jean Tirole is the chairman of the board of Jean-Jacques Laffont Foundation at the Toulouse School of Economics and the scientific director of IDEI. With his 12 books and more than 200 scientific articles, he has had a strong impact on the development of modern economics.
In 2014, Jean Tirole received the Nobel Memorial Prize in Economic Science for his analysis of market power and regulation. The Nobel Prize was awarded to Jean Tirole individually but it also represented recognition of the quality of the institution where Jean Tirole works.
The Nobel Prize put the Toulouse School of Economics in the spotlight, as well as the quality of its research and attracted new students and researchers.
Today: the continuation of a vision?
Jean Tirole and Jean-Jacques Laffont are two leaders in the development of modern economics and they played a crucial role in TSE’s development. However, the excellence is also due to the investment and participation of many collaborators and researchers.
All these people contributed to develop TSE and pursued Laffont’s vision.
Today, TSE, with more than 150 researchers and 2000 students, is ranked 17th in the Shanghai Ranking and 19th in the IDEAS/RePEc ranking. With this reputation, its international environment and its many degree programs in English, the school attracts a lot of foreigners.
After the creation of the first research centres, the establishment of the school, and the award of a Nobel Prize, another chapter will be started in 2019 with a new building for TSE’s researchers. Hopefully, it will be the nest of many great ideas in the years to come.
By Clara Etcheverry