[working papers]

-  “Financial distress and the role of management in micro and small-sized firms, NIPE WP 6/2020, IZA Discussion Paper No. 13738, 2020 [co-authors: Fernando Alexandre, Sara Cruz and Miguel Portela]

In this paper, we focus on managerial characteristics of micro and small-sized firms. Using linked employer-employee data on the Portuguese economy for the 2010-2018 period, we estimate the impact of management teams' human capital on the probability of firms becoming financially distressed and on their subsequent recovery. Our estimates show that the relevance of management teams' formal education on the probability of firms becoming financially distressed depends on firms' size and the type of education. We show that management teams' formal education and tenure reduces the probability of micro and small-sized firms becoming financially distressed and increases the probability of their subsequent recovery. The estimates also suggest that those impacts are stronger for micro and small-sized firms. Additionally, our results show that functional experience previously acquired in other firms, namely in foreign-owned and in exporting firms and in the area of finance, may reduce the probability of micro firms becoming financially distressed. On the other hand, previous functional experience in other firms seems to have a strong and highly significant impact on increasing the odds of recovery of financially distressed firms. We conclude that policies that induce an improvement in the managerial human capital of micro and small-sized firms have significant scope to improve their financial condition, enhancing the resilience of the economy against shocks.


-   “Minimum wage and financially distressed firms: another one bites the dust, NIPE WP 4/2020, IZA Discussion Paper No. 13526 , 2020 [co-authors: Fernando Alexandre, Pedro Bação, João Cerejeira, Hélder Costa and Miguel Portela]

Since late 2014, Portuguese Governments adopted ambitious minimum wage policies. Using linked employer-employee data, we provide an econometric evaluation of the impact of those policies. Our estimates suggest that minimum wage increases reduced employment growth and profitability, in particular for financially distressed firms. We also conclude that minimum wage increases had a positive impact on firms' exit, again amplified for financially distressed firms. According to these results, minimum wage policies may have had a supply side effect by accelerating the exit of low profitability and low productivity firms and, thus, contributing to improve aggregate productivity through a cleansing effect.

Returns to Postgraduate Education in Portugal: Holding on to a Higher Ground?”, NIPE WP 8/2017, IZA Discussion Paper No. 10676 , 2019 [co-authors:André Almeida, Hugo Figueiredo, João Cerejeira, Miguel Portela, Carla Sá and Pedro Teixeira]

In this paper we use a large official employer-employee data set to document and decompose the rising graduates postgraduates’ wage differentials in Portugal. Using a non-parametric matching exercise we disentangle two different sources of postgraduates’ relative earnings: higher wages within the same type of occupations and the access to better paid occupations. We further look at displacement and deskilling effects due to relative demand inertia as possible sources of the evolution of relative earnings. Our results show that both displacement and deskilling effects, particularly of graduates with only a first-degree, appear to be at least as important as direct productivity effects in explaining postgraduates premiums. We also conclude that the relative importance of the former has been steadily increasing overtime and that, on the contrary, the net creation of high-paying, postgraduateonly jobs has been relatively modest. This evidence suggests that postgraduate degrees have largely worked as a way of holding on to a higher ground.