Catastrophic job Destruction during the Portuguese Economic Crisis

Abstract

The papers and commentaries presented at the conference addressed many important issues related to the functioning of the euro area. Our hope is that these contributions will help improve understanding of the nature of Europe's monetary union, the underpinnings of its crisis, and the changes that are needed so that crises will be prevented in the future. The papers examined two main sets of issues. One group of papers, adopting a union-wide perspective, assessed the aspects of the euro area's institutional architecture that, with the benefit of hindsight, may have contributed to the crisis, and the policy responses to the crisis at the union level. A second group of papers focused on developments in three crisis countries-Greece, Ireland, and Portugal.

Institutional legacies and HRM: similarities and differences in HRM practices in Portugal and Mozambique

“…In terms of these findings' relevance for institutional theory, on the one hand, it could be argued that the common ground reflects abiding institutional legacies, with the modernization of institutions and economic life that took place in late colonial Mozambique leading to convergence with the key dimensions of the Portuguese model. As Pitcher (2002) notes, key features of Mozambican governance and society proved quite resilient despite independence, civil war and later neo-liberal reforms; it is as yet uncertain as to whether the 2008 economic crisis will have similarly limited effects on Portuguese institutions, although initial evidence suggests that marketization has, once more, gone hand-in-hand with structural continuities (Carneiro, Portugal, & Varejão, 2014). On the other hand, our findings may reflect practices that are relatively common amongst a broad range of firms operating within evolving institutional contexts.…”

Real Wage Cyclicality in the Eurozone Before and During the Great Recession: Evidence from Micro Data

“…These factors complicate the interpretation of cross-country results and comparisons with some recent studies. In particular, using administrative data for Portugal, Carneiro et al (2014) find substantial peaks at zero on the distribution of annual changes in the base wage for a non-negligible share of the workforce in recent years. Using the total wage, we do not observe such patterns for this country and others in our data.…”

“…For the UK, Gregg, Machin and Fernandez-Salgàndo (2014) noted an increased sensitivity of real wages to local unemployment during the Great Recession, which represents a distinct break from the past. 10 In contrast, in Portugal, Carneiro et al (2014) report substantial evidence of downward nominal rigidities of the base wage in administrative data.…”

“…This is an important shortcoming as we cannot distinguish the relative importance of each factor. Swanson (2007) found that the flexible part of wages play a substantial role in real wage procyclicality in the US, while recent evidence from Carneiro et al (2014) documents a substantial rigidity of the base wage in Portugal.…”

“…Unfortunately, we are not able to distinguish in our data the base wage, which might be much more downward rigid. Recent work by Carneiro et al (2014) for Portugal using administrative data points to the existence of significant rigidities in the base wage during the Great Recession. In particular, they report a share of 30% of base wage freezes in 2013 against only 5% in…”