Capital services estimates in Portuguese industries, 1977-2003

This paper presents capital services estimates for 26 Portuguese industries for the 1977-2003 period. The estimation procedure follows an integrated approach under which the flows of capital services are approximated as a proportion of the capital stock converted into standard efficiency units. Our findings suggest a close proximity between the evolution of capital flows and the observed fluctuations of Portuguese macroeconomic growth. TFP growth estimates based on growth accounting reveal, furthermore, a very disappointing performance of the Portuguese economy during the period under study,with an average annual rate of TFP growth of 0.8% being observed. Performance varies across industries, but the bulk of activities show very modest rates of TFP growth.Capital services, TFP, Portugal

Portugal and Spain: catching up and falling behind. A comparative analysis of productivity trends and their causes, 1980-2007

A number of studies in the literature have recently explored the causes behind the European productivity slowdown from the mid-1990s onwards and the correlative increase in the productivity gap between Europe and the United States (e.g., van Ark et al, 2008; Maudos et al, 2008; van Ark and Inklaar, 2005). Much less attention has been given, however, to the specific role of the EU peripheral countries in the process. In this paper we focus on the growth performances of two of such countries: Portugal and Spain. After a period of successful catch-up relative to the EU core, the two countries, which have a number of historical and economic features in common, have recently faced increasing difficulties in closing the gap to the EU. In the last decade, Spain has shown one of the worst productivity growth records among EU-members, whereas Portugal remained quite distant from European average productivity levels, and has increased the gap in per capita income levels. In this paper an attempt is made to shed light on the causes behind the overall disappointing performance of both countries, by focusing on the role of structural change on the process. An extensive literature, from both mainstream and more heterodox streams of research, suggests that sectoral specialization may have a major impact on productivity growth, by influencing the extent to which innovation and technological progress can be achieved. In order to account for these effects, an analysis of productivity trends both at the macroeconomic and industry levels of analysis is undertaken, using growth accounting and shiftshare techniques. The analysis is based on data from the EU-KLEMS database for Spain and the EU-core, and on an update and refinement of Silva´s (2010) labor and multifactor productivity estimates for Portugal. By investigating the different sources of productivity growth between 1980 and 2007, it is argued that an important factor explaining the growth difficulties in both countries is related to their difficulties in promoting important changes in their economic structures. In particular, the recent deterioration of economic growth may be seen as reflecting their incapacity in making a strong leap towards a more ‘modern’ industry structure.Productivity, Economic growth, Structural change, Technology

A stochastic spreadsheet model analysing investment options for the development of pasture on beef cattle farms : a dissertation submitted in partial fulfilment of the requirements for the degree of Master in Applied Science at Massey University

The decision to proceed with farm development to increase animal production is complex. Standalone personal computer software to study either the financial or physical aspects of farm development is available, but models which integrate these components and account for the risks associated with the investment are not. A stochastic spreadsheet (Microsoft Excel®) model was therefore developed to predict the profitability, feasibility and risk of pasture development for two case farms: one in southern Brazil and the other near Wanganui in New Zealand. Pasture was developed at different rates for each farm and the model was used to predict the associated physical and financial changes over-time and a probability distribution of the net present values (NPV) of the net operating profit after tax and before interest (NOPAT) relative to the status quo situation. The extra pasture was used solely for increasing beef cattle production. On the Brazilian case farm the development of 2,263 ha at two rates was studied. The continuation of the status quo had first degree stochastic dominance in terms of the NPV over both development rates; it was superior by about NZ$46.000 for the 200 ha/y option and ca. NZ$ 110.000 for the 500 ha/y option at a 16% discount rate. However, at a 6% discount rate the 500 ha/y development rate had first degree stochastic dominance in terms of the NPV over both the continuation of the status quo (by about NZ$960.000) and the 200 ha/y option (ca. NZ$ 120.000). This indicates that pasture development could proceed profitability if interest rates continue to fall in Brazil as predicted. For the New Zealand case farm the development of 247 ha at 50 ha/y had first degree stochastic dominance over the 25 ha/y (ca. NZ$24,000) and continuation of the status quo (ca. NZ$ 208.000) at a 6% discount rate. Pasture development should therefore continue. Stochastic analysis of the pasture development investment options gave a better insight into the likely outcomes for a project, and provides the farmer with more information for making a decision on whether, and how. to proceed with farm development. The model could easily be adapted for studying farm development with respect to other types of livestock enterprises Keywords: pastures, development, risk, feasibility, profitability, model

Are Voters Rationally Ignorant? An Empirical Study for Portuguese Local Elections

The application of the rational choice postulate to a political context invariably leads to the conclusion that most voters are ill informed when making the decision for whom to vote. In this paper, the authors do an empirical evaluation of the rational ignorance theory, based on the results of the 1997 Portuguese Local Elections. The results only partially sustain the hypothesis of rational ignorance, although it is also possible to identify several limitations that prevent the establishment of definite conclusions in this specific field.JEL Classification: H7 Key words: Voter’s Behaviour; Local Elections; Local Governments; Portugal.

Surveying structural change: seminal contributions and a bibliometric account

The main aim of this paper is to provide a comprehensive survey of the economic literature on structural change. Along with an insightful literature review of the seminal contributions in the field, we perform a quantitative analysis that takes into account all the theoretical and empirical articles on the subject that were published from 1969 onwards. This effort to gather the relevant documentation is based on a review of 910 abstracts from articles published in all the economic journals found in the Econlit database over the past forty years. According to our quantitative analysis, structural change analysis received a major boost in the 1990s, with a considerable increase in the number of articles published on the matter. The marked rise in interest seems to be primarily related to the growing concern to find explanations for the process of technological change and its effects on the economy. In the first half of the current decade technological change comprises a predominant area of research, accounting for about one quarter of the articles published. Despite the increased formalism observed in the 1990s, our results further highlight that the bulk of the research in this field remains empirically led. Furthermore, and quite surprisingly, discussions concerning ICTs do not seem to have been translated so far into a substantial increase in research on structural change-related issues.Structural Change; Bibliometrics; Econlit