Maximum Duration of Fixed-Term Labor Contracts in Recessions

Policy makers and academics put great effort in understanding and minimising the negative employment effects of business cycles. This paper evaluates one policy option in this regard: greater flexibility in the maximum duration of fixed term contracts during recessions. Its simple rationale is that, when faced with an uncertain outlook (and restrictive permanent contracts), firms… Continue reading Maximum Duration of Fixed-Term Labor Contracts in Recessions

From Convergece to Divergence: Portuguese Demography and Economic Growth, 1500-1850

When did Portugal’s economy diverge from the European core? This paper constructs the first time-series for Portugal’s per capita GDP for 1500-1850, drawing on a new and extensive database. Starting around 1550 there was a highly persistent upward trend on per capita income, which accelerated after 1700 and peaked 50 years later. At that point,… Continue reading From Convergece to Divergence: Portuguese Demography and Economic Growth, 1500-1850

Demand, Supply and Markup Fluctuations

Does monopoly power (i.e. markups) increase or decrease in recessions? If market power increases in recessions, production becomes more inefficient aggravating the recession. However, if market power decreases, competition works as a self-correcting mechanism in the economy increasing overall efficiency. For this reason, understanding how markups fluctuate has been so central in the debate about… Continue reading Demand, Supply and Markup Fluctuations

The effects of cultural heritage on residential property values: evidence from Lisbon, Portugal

Historic cities are identifiable through their iconic monuments and buildings. Location relative to these structures generate premiums in the housing market. We examine the impact of such historic amenities on housing prices in Lisbon, Portugal. Results reveal heterogeneous impacts from different types of monuments. Churches, palaces and stone architecture have their own unique impact on… Continue reading The effects of cultural heritage on residential property values: evidence from Lisbon, Portugal

Portuguese external imbalances: driven by demand rather than price competitiveness

Large current account deficits in European economies, among them Portugal, have been a decisive feature of the European banking and sovereign debt crisis. While the Portuguese current account has undergone a severe adjustment, the level of external debt remains among the highest in Europe and reducing it down to the threshold defined by the EU-Commission’s… Continue reading Portuguese external imbalances: driven by demand rather than price competitiveness

The Portuguese interbank money market during the subprime crisis and sovereign debt crisis

Money markets were severely impaired by the financial crisis and subsequent sovereign debt crisis. During the summer of 2007, BNP Paribas suspended redemptions for three investment funds due to the uncertainty regarding structured products. This event triggered the first stage of the financial crises in the euro area and linked it to the subprime mortgage… Continue reading The Portuguese interbank money market during the subprime crisis and sovereign debt crisis

Sorry, we’re closed: loan conditions when bank branches close and firms transfer to another bank

Using a dataset with information on new loans granted in Portugal, we find that when firms switch to a new bank they are able to obtain lower interest rates. This result is in line with previous findings in the literature. However, the existing literature fails to explain which of two competing explanations drive these results.… Continue reading Sorry, we’re closed: loan conditions when bank branches close and firms transfer to another bank