Fiscal adjustments and sovereign default in different government systems

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Economics from the NOVA – School of Business and Economics

Parametric portfolio policies: An application for a global tactical asset allocation model

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Finance from the NOVA – School of Business and Economics

Economic analysis in health care regulation : three essays

ABSTRACT - It is the purpose of the present thesis to emphasize, through a series of examples, the need and value of appropriate pre-analysis of the impact of health care regulation. Specifically, the thesis presents three papers on the theme of regulation in different aspects of health care provision and financing. The first two consist of economic analyses of the impact of health care regulation and the third comprises the creation of an instrument for supporting economic analysis of health care regulation, namely in the field of evaluation of health care programs. The first paper develops a model of health plan competition and pricing in order to understand the dynamics of health plan entry and exit in the presence of switching costs and alternative health premium payment systems. We build an explicit model of death spirals, in which profitmaximizing competing health plans find it optimal to adopt a pattern of increasing relative prices culminating in health plan exit. We find the steady-state numerical solution for the price sequence and the plan’s optimal length of life through simulation and do some comparative statics. This allows us to show that using risk adjusted premiums and imposing price floors are effective at reducing death spirals and switching costs, while having employees pay a fixed share of the premium enhances death spirals and increases switching costs. Price regulation of pharmaceuticals is one of the cost control measures adopted by the Portuguese government, as in many European countries. When such regulation decreases the products’ real price over time, it may create an incentive for product turnover. Using panel data for the period of 1997 through 2003 on drug packages sold in Portuguese pharmacies, the second paper addresses the question of whether price control policies create an incentive for product withdrawal. Our work builds the product survival literature by accounting for unobservable product characteristics and heterogeneity among consumers when constructing quality, price control and competition indexes. These indexes are then used as covariates in a Cox proportional hazard model. We find that, indeed, price control measures increase the probability of exit, and that such effect is not verified in OTC market where no such price regulation measures exist. We also find quality to have a significant positive impact on product survival. In the third paper, we develop a microsimulation discrete events model (MSDEM) for costeffectiveness analysis of Human Immunodeficiency Virus treatment, simulating individual paths from antiretroviral therapy (ART) initiation to death. Four driving forces determine the course of events: CD4+ cell count, viral load resistance and adherence. A novel feature of the model with respect to the previous MSDEMs is that distributions of time to event depend on individuals’ characteristics and past history. Time to event was modeled using parametric survival analysis. Events modeled include: viral suppression, regimen switch due virological failure, regimen switch due to other reasons, resistance development, hospitalization, AIDS events, and death. Disease progression is structured according to therapy lines and the model is parameterized with cohort Portuguese observational data. An application of the model is presented comparing the cost-effectiveness ART initiation with two nucleoside analogue reverse transcriptase inhibitors (NRTI) plus one non-nucleoside reverse transcriptase inhibitor(NNRTI) to two NRTI plus boosted protease inhibitor (PI/r) in HIV- 1 infected individuals. We find 2NRTI+NNRTI to be a dominant strategy. Results predicted by the model reproduce those of the data used for parameterization and are in line with those published in the literature.

A green future for European electricity? :Energy sources, policies and further determinants of the household price of electricity

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Economics from the NOVA – School of Business and Economics

Nominal and inflation-linked government bonds: An assessment of arbitrage opportunities in UK Gilt Market

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Finance from the NOVA – School of Business and Economics

The effects of land-use development policies on forest management

This paper develops a model of a forest owner operating in an open-city environment, where the rent for developed land is increasing concave in nearby preserved open space and is rising over time reflecting an upward trend in households’ income. Thus, our model creates the possibility of switching from forestry to residential use at some point in the future. In addition it allows the optimal harvest length to vary over time even if stumpage prices and regeneration costs remain constant. Within this framework we examine how adjacent preserved open space and alternative development constraints affect the private landowner´s decisions. We find that in the presence of rising income, preserved open space hastens regeneration and conversion cuts but leads to lower density development of nearby unzoned parcels due to indirect dynamic effects. We also find that both a binding development moratorium and a binding minimum-lot-size policy can postpone regeneration and conversion cut dates and thus help to protect open space even if only temporarily. However, the policies do not have the same effects on development density of converted forestland. While the former leads to high-density development, the latter encourages low-density development.

Regional growth in Europe: The role of European and national policies

We conduct a systematic study of the impact of European Union (EU) regional policies on regional economic growth that controls for national policies and geographic characteristics. Special care is taken in distinguishing between the impact of EU policies and of national policies on economic growth. Our empirical study tries to answer two different questions. First, is there convergence across EU regions, and if so, do regions converge to a common European steady-state or to a national one? Second, how do European and national policies affect regional growth? We find evidence of regional convergence at the national level but not at the European level. In addition we find that trade openness at the national level is associated with regional convergence while European regional policies contribute, though weakly, to regional convergence. Our results suggest that policies that foster market integration – and convergence to a common steady-state - such as the promotion of labour and capital movements across countries and common regulatory policies are as important for European-wide regional convergence as regional structural funds.

Policies to improve the lives of Slum Dwellers – from international agreements to local contexts. The Brazilian case-study

Last decades economic development induced massive international and regional migration flows directed to the urban spaces. The magnitude and swiftness of these processes determined that several cities’ authorities would fail to respond to the increasing demands of many social services. The right to an “adequate housing” emerged as a political concern, leading governments and institutions to develop housing programmes directed to improve the lives of slum dwellers. This paper presents a diachronic evolution of these specific housing policies in the paradigmatic case-study of Brazil, critically analysing the evolving roles played by the multiple levels of decision (from international institutions to local communities) in the development and implementation of such measures.

Government bond yield spreads in EMU countries: The story of an ephemeral convergence

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Economics from the NOVA – School of Business and Economics

Determinants of the Portuguese government bond yield spread

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Finance from the NOVA – School of Business and Economics

Socio-ethnic segregation and sustainable urban city planning in Lisbon

Dissertação apresentada para cumprimento dos requisitos necessários à obtenção do grau de Mestre em Ecologia Humana e Problemas Sociais Contemporâneos

Políticas de financiamento de I&D em Portugal [R&D financing policies in Portugal]

Baseado no relatório para a disciplina de “Avaliação de Ciência e Tecnologia” da responsabilidade do Prof. João Crespo (FCT-UNL) do Programa Doutoral em Avaliação de Tecnologia em 2012

Determinants of Portuguese bank’s provisioning policies: Discretionary behaviour of generic and specific allowances

In this paper we test for the impact of the regulatory environment on a bank’s discretionary provisioning practices. We develop a model that structures the dynamics of the provision policy for the two classes of provisions: generic provisions and specific provisions. The model is tested using a comprehensive database of all financial institutions operating in Portugal for 1990-2000. This unique dataset comprises banks subject to the Portuguese rules as well as bank subsidiaries subject to their home-country regulation and we were able to identify distinct behaviours between them. Our results show the importance of handling he two types of provisions separately. They support the hypothesis that banks have a discretionary behaviour in setting up their provisions, and find evidence of income smoothing and capital management. We also find that the regulatory regime impacts on discretionary provisioning policies because banks when forced to increase one type of provision react by reducing the iscretionary component of the other, a finding we designated as a substitution effect.

Overcoming the “European Paradox”: The role of Regional Innovation Systems (RIS) in translating R&D investments into economic and employment growth

The emergence of the so-called “European Paradox” shows that R&D investment is not maximally effective and that increasing the scale of public R&D expenditures is not sufficient to generate employment and sustained economic growth. Increasing Governmental R&D Investment is far from being a “panacea” for stagnant growth. It is worth noting that Government R&D Investment does not have a statistically significant impact on employment, indicating the need to assess the trade-offs of policies that could lead to significant increases in government expenditure. Surprisingly, Governmental R&D Employment does not contribute to “mass-market” employment, despite its quite important role in reducing Youth-Unemployment. Despite the negative side-effects of Governmental R&D Employment on both GVA and GDP, University R&D Employment appears to have a quite important role in reducing Unemployment, especially Youth-Unemployment, while it also does not have a downside in terms of economic growth. Technological Capacity enhancement is the most effective instrument for reducing Unemployment and is a policy without any downside regarding sustainable economical development. In terms of wider policy implications, the results reinforce the idea that European Commission Research and Innovation policies must be restructured, shifting from a transnational framework to a more localised, measurable and operational approach.

Fiscal adjustments and sovereign default in different government systems

This paper extends the model of Spolaore (2004) about adjustments in di erent government systems for the context of scal adjustments and sovereign default. We introduce asymmetry between groups in income and preferences towards scal reforms. Default a ects di erently each group and becomes a possibility if reforms are not enacted after public nance solvency shocks, in uencing the political game according to its likelihood. With the extensions, new situations which were not possible with the previous framework arise. After the exposition of the model, the Argentine default in 2001 provides an example of the political con icts addressed by the model.