Public vs Private Schooling in an Endogenous Growth Model

I present an overlapping generations model, with formal education as the engine of growth, close to Glomm and RaviKumar (1992). Contrary to Glomm and Ravikumar, I Show that public schooling, when compared to a private system, may stimulate economic growth.

Understanding the Impact of Oil Shocks

This paper provides new empirical evidence on and theoretical support for the close link between oil prices and aggregate macroeconomic performence in the 1970s. Although this link has been well documented in the empirical literature and is further confirmed in this paper, standard economic models are not able to replicate this link when actual oil prices are used to stimulate the models. In particular, standard models cannot explain the depht of the recession in 1974-75 and the strong revival in 1976-78 based on the oil price movements in that period. This paper argues that a missing multiplier-accelerator mechanism from standard models may hold the key. This multipliplier-accelerator mechanism not only exacerbated the impact of the oil schocks in 1973-74 but also helped create the temporary recovery in 1976-1978. This paper derives the missing multiplier-accelarator mechanism from externalities in general equilibrium. Our calibrated model can explain both the recession in 1974-75 and revival in 1976-78.Oil price shocks, Real business cycle, indeterminacy, capacity utilization, externalities, monopolistic competition.

Foreign Trade and Equilibrium Indeterminacy

We show that dependence of production on foreign inputs (or non-producible natural resources) can significantly increase the likelihood of indeterminacy. Payment of imported foreign factors of production may act as a semi-fixed cost, amplifying production externalities and returns to scale, making selffulfilling expectations driven busyness cycles easier to arise. This is demonstrated using a standard neoclassical growth model. Calibration exercise shows that the required increasing returns to scale can be reduced by as much as 64% based on estimated share of foreign inputs in production for OECD countries.Indeterminacy, Factor Imports, Natural Resources, Capacity Utilization, Externality, Returns to Scale, Open Economy, Sunspots, Self- Fulfilling Expectations.

Oil Dependence and Economic Instability

We show that dependence on foreign energy can increase economic instability by raising the likelihood of equilibrium indeterminacy, hence making fluctuations driven by self-fulfilling expectations easier to occur. This is demonstrated in a standard neoclassical growth model. Calibration exercises, based on the estimated share of imported energy in production for several countries, show that the degree of reliance on foreign energy for many countries can easily make an otherwise determinate and stable economy indeterminate and unstable.Indeterminacy, Energy Imports, Externality, Returns to Scale, Sunspots, Self-Fulfilling Expectations.

A Note on the Stability Properties of Goodwin's Predator-Prey Model

Goodwin's Predator-Prey model is structurally unstable. In its pure form, the model has an equilibrium that is neither stable nor unstable. Ploeg showed that relaxing the hypothesis of fixed proportion technology would stabilize the equilibrium. On the other hand, Goodwin showed that the equilibrium becomes unstable when endogenous productivity growth is considered. This paper studies the consequences of considering both effects, and concludes that the stabilizing effect of a flexible technology is much stronger than the destabilizing effect of endogenizing labor productivity.Business cycles, nonlinear dynamics, distributive conflict, Goodwin, Marxian Economics

Using cross-wavelets to decompose the time-frequency relation between oil and the macroeconomy

A large body of empirical literature has suggested that oil price shocks have an important effect on economic activity. But in most of the literature the analysis is exclusively done in the time domain. However, interesting relations exist at different frequencies. We use (cross) wavelet analysis to uncover some of these relations, estimating the spectral characteristics of the time-series as a function of time. Our analysis suggests that the volatility of both the inflation rate and the output growth rate started to decrease in the decades of 1950 and 1960, suggesting that the great moderation started then,but that it was temporarily interrupted due to the oils crisis of the 1970s, whose effects extend until the mid 1980s. We also show that while at business cycle frequencies oil prices lead industrial production, in the very long run production increases lead oil price increases. The exception to this long-run relation occurred between the mid 1970s and mid 1980s. Our analysis also suggests that monetary policy became much more eficient after 1980 to deal with the inflationary pressures of oil shocks.Business cycles, time-frequency analysis, non-stationary time series, wavelets, cross wavelets, wavelet coherency.

Foreign Direct Investment in Brazil and Home Country Risk

This study looks into the factors that explain foreign direct investment in Brazil by country of origin of investment. Based on a sample of more than 100 countries that invested and have not yet invested in Brazil, multiple estimation techniques, such as the Tobit, Heckit and Probit, are used to isolate the effect of country risk on outward foreign direct investment. In sharp contrast to the findings of previous studies on the effect of home country risk on foreign investment in the United States, the findings in this paper reveal that less risky countries invest more in Brazil. These results are controlled for size of the home country, distance, trade intensity and previous investments abroad. A simple out of sample check shows that the model correctly predicts probability of investing for a large number of countries. The existing literature does not document these results.Foreign Direct Investment; Country Risk; Tobit and Heckit Estimation

Using Wavelets to decompose time-frequency economic relations

Economic agents simultaneously operate at different horizons. Many economic processes are the result of the actions of several agents with different term objectives. Therefore, economic time-series is a combination of components operating on different frequencies. Several questions about the data are connected to the understanding of the time-series behavior at different frequencies. While Fourier analysis is not appropriate to study the cyclical nature of economic time-series, because these are rarely stationary, wavelet analysis performs the estimation of the spectral characteristics of a time-series as a function of time. In spite of all its advantages, wavelets are hardly ever used in economics. The purpose of this paper is to show that cross wavelet analysis can be used to directly study the interactions different time-series in the time-frequency domain. We use wavelets to analyze the impact of interest rate price changes on some macroeconomic variables: Industrial Production, Inflation and the monetary aggregates M1 and M2. Specifically, three tools are utilized: the wavelet power spectrum, wavelet coherency and wavelet phase-difference. These instruments illustrate how the use of wavelets may help to unravel economic time-frequency relations that would otherwise remain hidden.Monetary policy, time-frequency analysis, non-stationary time series, wavelets, cross wavelets, wavelet coherency.

CLICTOUR - Roteiro para o turismo sustentável nas áreas protegidas do norte de Portugal

A indústria do turismo desempenha um papel de elevada relevância nas economias nacionais e regionais a nível global. Com o crescente interesse na visitação de áreas protegidas, muitas destas regiões, anteriormente intocadas, têm-se transformado em destinos turísticos de importância significativa e amplamente populares, atraindo um número elevado de visitantes anualmente. Ao mesmo tempo, várias áreas naturais e ecossistemas encontram-se ameaçados pelos desafios decorrentes das alterações climáticas, perda de biodiversidade e atividades antropogénicas, os quais podem comprometer a sua sustentabilidade. O sector do turismo representa, em muitos casos, um elemento central do crescimento económico das áreas protegidas, constituindo um instrumento crítico para o desenvolvimento sustentável das comunidades locais e para a geração de receitas para os esforços de conservação. Consequentemente, é crucial identificar mecanismos que permitam o desenvolvimento de um sector turístico resiliente e adaptado, capaz de suportar os impactes eminentes das alterações climáticas. A investigação realizada no âmbito do projeto CLICTOUR foca três áreas protegidas distintas localizadas no norte de Portugal, nomeadamente, o Parque Nacional da Peneda-Gerês (PNPG), o Parque Natural do Alvão (PNA) e o Parque Natural do Litoral Norte (PNLN). Apesar das suas caraterísticas contrastantes, estas áreas protegidas acompanharam a forte tendência de crescimento do turismo português desde 2013, interrompida apenas pela pandemia do COVID-19. O turismo de natureza surge como um dos destaques destas áreas, oferecendo percursos pedestres, caminhadas e oportunidades para observar flora, fauna e paisagens. Além disto, destacam-se uma variedade de atividades de turismo desportivo e de aventura no PNPG, enquanto o PNLN oferece um conjunto alargado de atividades náuticas, bem como o tradicional sol e praia. Considerando os desafios impostos pela emergência climática e a elevada vulnerabilidade do sector do turismo aos seus efeitos, é fundamental avaliar os impactes desses eventos extremos, mas não só, no turismo e noutros sectores estratégicos. A realização dessa avaliação possibilita a criação de estratégias de resposta e adaptação, promovendo o desenvolvimento de um turismo sustentável e resiliente às alterações climáticas nas áreas protegidas do norte de Portugal. Concretizam-se, assim, os objetivos do projeto na avaliação do impacte das alterações climáticas nesta zona, e consequente efeito no turismo, e na promoção de linhas diretrizes de desenvolvimento de um turismo de natureza resiliente às alterações climáticas, que constituem o “Roteiro”. Este trabalho segue nas secções seguintes apresentando na Parte II os estudos desenvolvidos, em específico apresentando os parques envolvidos na secção 1, as alterações climáticas esperadas para as próximas décadas no norte de Portugal na secção 2, e os principais perspetivas aplicadas realizados na secção 3. Na Parte III desenvolve-se o “Roteiro” nas suas quatro dimensões, concluindo o trabalho