CEF.UP – WiP Seminar/Webinar

Friday – June 7^th, 2024 at 13:00h (1 pm) | Room 305 | Online

Fiscal Policy Dispersion in the Euro Area – a new quantitative index

Daniel Loureiro – FEP – School of Economics and Management – University of Porto and Cef.Up

Abstract:

“We developed a new Fiscal Dispersion Index to assess fiscal policy coordination in the Euro Area and complement the existent literature. We found greater fiscal policy dispersion around the years of economic crisis, signaling a deterioration of coordination. Besides, we highlighted Portugal as one the most problematic countries, continuously deviating from the average policies. However, the direction of the Portuguese deviation is not constant over time. It shifted from looser policies between 2000 and 2007 to tighter policies from 2016 to 2021. Moreover, we also found that Germany and Netherlands pursued tighter policies than the average, particularly when facing common shocks. Thus, we recommend that additional measures should be approved to improve coordination during the more challenging times, preventing insufficient expansionary policies. Failing to do so will likely hamper the credibility of the European framework and institutions.”

CEF.UP – WiP Seminar/Webinar

Friday – May 24^th, 2024 at 13:00h (1 pm) | Room 305 | Online

The Political Economy of Central Bank Digital Currencies and Monetary Policy

Francisco Nunes Pereira – FEP – School of Economics and Management, University of Porto and Cef.Up

Abstract:

This paper scrutinizes the monetary policy case in favor of Central Bank Digital Currencies (CBDCs) from a political economy angle. The proponents of CBDCs argue that their introduction would streamline the monetary policy transmission mechanism, enable novel policy interventions, and enhance data collection capabilities, ultimately leading to improved central bank performance. However, the arrangements of monetary institutions result in central banks entangled in incentive and epistemic issues, which limit their performance. CBDCs not only fail to mitigate these problems but indeed exacerbate them. We argue that the central bank becomes more vulnerable to political interference and rent-seeking activities once a CBDC is created. Moreover, the enhanced ability to monitor economic activities may lead central banks to succumb to the ‘pretense of knowledge syndrome,’ which compounds the incentives for discretionary interventions. We conclude that there is a means-ends inconsistency in the monetary policy case for CBDCs.

CEF.UP – WiP Seminar/Webinar

Monday – April 22^nd, 2024 at 1:00 p.m. | Room 305 | Online

“Keeping it in the Family: Student to Degree Match”

Pedro Luís Silva – FEP, Centre for Research in Higher Education Policies (CIPES) and Institute of Labour Economics (IZA) (joint work with Richard Murphy)

Abstract:

“This paper examines systematic inequalities in the match between students and the university degree they apply to, and enroll in. Using linked administrative data on the population of Portuguese applicants we create a transparent and continuous measure of student-to-degree match employing minimal assumptions. We find that students who are first in the family to attend post-secondary education consistently match to lower quality degrees across the entire achievement distribution. In contrast, only the highest achieving female students relatively undermatch. These gaps are larger at the application stage. We explore the role of student preferences and the consequences for intergenerational mobility.”

CEF.UP – WiP Seminar/Webinar

Tuesday – March 19^st, 2024 at 1:00 p.m. | Room 305 | Online

Title: “Fissured Firms and Worker Outcomes” (with Matias Cortes – York University;  Diego Dabed – Utrecht University; Anna Salomons – Utrecht University)

Ana Oliveira – Utrecht University (Netherlands)

Abstract:

“We consider how firms’ organization of production relates to workers’ wages. Using matched employer-employee data from Portugal, we document that, within detailed industries, firms differ starkly in terms of their occupational employment concentration, with some firms employing workers across a broad range of occupations and others being much more specialized. These differences are robustly predictive of wages: a worker employed in a specialized, i.e. `fissured’ firm earns less than that same worker employed in a less specialized firm. This wage penalty cannot exclusively be explained by worker-firm sorting, and is observed across a wide range of occupations. Firm specialization helps account for the role of firms in inequality: over half of the wage penalty from specialization is explained by differences in firm productivity, and firm specialization is strongly negatively related to AKM firm fixed effects. However, the evidence does not support a large role for increased pay transparency or lower rent-sharing as mechanisms for the observed wage penalty from firm specialization.”

CEF.UP – WiP Seminar/Webinar

Friday – February 23^rd, 2024 at 1:00 p.m. | Room 305 | Online

Title: “On the disentanglement of an Economic Union” (with José M. Gaspar e Kiyohiro Ikeda)

Jorge Saraiva – FEP, School of Economics and Management, University of Porto and Universidade Portucalense

Abstract:

“We study how the unilateral withdrawal of a region from an economic union affects the spatial distribution of economic activity and social welfare. We explore the three-region quasi-linear log utility footloose entrepreneur model under the assumption that this dissent can be expressed as a higher transportation cost between the leaving party and the remaining union members. We find that a spatial distribution in which entrepreneurs are equally shared between the three regions is no longer possible and that asymmetric equilibria – in which the dissident region has the lowest share of entrepreneurs – arise. We also find that it is not stable for entrepreneurs to distribute them- selves only between the remaining regions in the union. We conclude that the leaving region’s share of entrepreneurs is higher, the lower the differential in transportation costs is, and the higher the mobility of workers between regions is. Finally, we also conclude that, from a global social welfare point of view, the economy as a whole attains its maximum well-being when most entrepreneurs do not live in the dissident region.”

CEF.UP – WiP Seminar/Webinar

Wednesday – February 14^th, 2024 at 1:00 p.m. | Room 305 | Online

Title: “An overlapping-generations model with data-driven equilibrium behavior” (with Alexander Gorokhovsky)

Anna Rubinchik – FEP, School of Economics and Management, University of Porto

Abstract:

“We propose a class of overlapping generations models that can serve as a workhorse for policy analysis. Recent literature identifies several features of key observable economic variables in Europe and the U.S.: the life-cycle path of earnings is hump-shaped, while the aggregate variables — per-capita consumption and labor hours — exhibit a clear time trend. Our class generates non-monotonic life-cycle behavior of labor supply and the desired aggregate trends in all its balanced-growth equilibria (BGE). There is a finite number of these equilibria and at least one of them exists provided a single-generation consumer problem has a solution. The model has a constant-returns-to-scale production, nontrivial depreciation of capital, exogenous labor-saving growth and an arbitrary individual life-cycle productivity. The necessary restrictions imposed on preferences are consistent with those generating the aggregate trends in a representative-agent economy, while ruling out popular specifications such as Cobb-Douglas or CES. We characterize BGE with MaCurdy preferences and solve a parametrized model that yields at least two stationary equilibria with reasonable interest rates. The hump-shaped life-cycle consumption profile can be generated with an additional parameter interpreted as reflecting family structure or a desire for immediate gratification that peaks at mid-life.”

CEF.UP – WiP Seminar/Webinar

Tuesday – November 21^st, 2023 at 1:00 p.m. | Room 305 | Online

“Efficiency of Resource Allocation in the Suppression of European Wildfires”

Zheng Hou – Cef.up

Abstract:

“In recent years, particularly 2022, heavy losses of property, injuries and deaths have been caused by wildfires in many European countries. Increasing wildfires exert pressure to balance cost, benefits and risks of wildfire management. Wildfire studies are less developed in Europe compared to the US. Several groups of factors have to be considered in wildfire suppression decisions: loss, expenditure, allocation of resources, environmental and socio-economic parameters. Previous studies on wildfire suppression usually apply simple econometrical models to address the relationship between only two among the factors above. To establish a framework to systematically assess efficiency in wildfire suppression involving all the main factors, this project will construct a Stochastic Frontier model in the form of Cost-and-Loss Distance Function using cross-sectional data on European wildfires. The model measures whether wildfire suppression cases are efficient in minimizing cost and loss and whether environmental and socio-economic parameters contribute to such efficiency. Fire managers often face trade-offs between environmental/property losses and expenditure spent on fire suppression with constraints on resources (machines, crews, etc.) available at hand. The research outcome will provide a reference to improve this decision process by helping identify where more resource is needed and justifying budget increase since there are locations where potentially require more resource for wildfire suppression. Finally, this project will contribute to efficiency improvement in wildfire suppression, and thus help achieve SDGs 3, 11, 13 and 15.”