Financialisation in the european periphery and the sovereign debt crisis: the portuguese case

Barradas, Ricardo; Lagoa, Sérgio; Leão, Emanuel; Mamede, Ricardo Paes

doi:10.15847/dinamiacet-iul.wp.2015.12

Cited by 10 publications

(23 citation statements)

References 25 publications

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“…As a result, the financial system gained huge importance, which has not reflected a sustained path of strong economic growth in Portugal since that time. Moreover, the growth of the financial system is at the root of the last financial and economic crisis in Portugal, the so-called sovereign debt crisis (Barradas et al, 2018).…”

Section: Introductionmentioning

confidence: 99%

“…The first of these new additions is the analysis of the Portuguese context, for which the empirical evidence is non-existent. Portugal is a very interesting case study, mainly because the financial system has played an important role in the evolution of this economy and in the corresponding anaemic growth during recent years (Barradas et al, 2018). The second novelty is the application of a time series econometric analysis.…”

Section: Introductionmentioning

confidence: 99%

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Does the financial system support economic growth in times of financialisation? Evidence for Portugal

Barradas

2020

International Review of Applied Economics

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The purpose of this paper is the conduction of a time series econometric analysis in order to examine empirically the relationship between the financial system and economic growth in Portugal from 1977 to 2016. The Portuguese financial system has experienced a strong wave of privatisations, liberalisations and deregulations since the adhesion of Portugal to the European Economic Community in 1986, which has not favoured a sustained path of strong economic growth since then. The growth of the financial system played even a crucial role in the recent sovereign debt crisis in Portugal, casting doubts on the conventional hypothesis on the financegrowth nexus. The paper estimates a linear growth model and a non-linear growth model, which includes four proxies for the financial system (money supply, credit, financial value added and stock market capitalisation) and four further control variables (inflation, government consumption, trade openness and education). The paper finds a negative linear relationship between the banking system and Portuguese economic growth, a positive linear relationship between the stock markets and Portuguese economic growth, a concave quadratic relationship between the banking system and Portuguese economic growth, and a convex quadratic relationship between the stock markets and Portuguese economic growth. This suggests that Portuguese policy makers should canalise efforts to decrease the importance of banking system and to increase the importance of stock markets in order to support more robust economic growth in the coming years.

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Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Does the financial system support economic growth in times of financialisation? Evidence for Portugal

Barradas

2020

International Review of Applied Economics

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“…As a whole, rentiers probably exert less pressure through financial markets than in other countries; however, the pressure exerted by shareholders at the annual general meeting and by the management board of non-quoted firms cannot be ignored. A systematic analysis of the financialisation process in Portugal can be found in Barradas et al (2015) and in Rodrigues et al (2016).…”

Section: Introductionmentioning

confidence: 99%

Functional income distribution in portugal: The role of financialisation and other related determinants

Barradas

Lagoa

2017

Soc Ec

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This paper makes an empirical analysis of the relationship between the labour income share and both financialisation and other related variables in Portugal from 1978 to 2012. We estimate an equation for the labour share that includes standard variables (technological progress, globalisation, education and business cycle) and variables to capture the effect of financialisation. We formulate the hypothesis that the financialisation process may lead to a rise in the inequality of functional income distribution through three channels: the change in the sectorial composition of the economy (due to both the increase in the weight of the financial activity and the decrease in government activity), the diffusion of shareholder value governance practices and the weakening of trade unions. Our results show that the financialisation process as an indirect long-term effect on the labour share through its impact on government activity and trade union density. The paper also finds evidence supporting the traditional explanations for functional income distribution, namely globalisation, education and business cycle. FUNCTIONAL INCOME DISTRIBUTION IN PORTUGAL: THE ROLE OF FINANCIALISATION AND OTHER RELATED DETERMINANTS ABSTRACTThis paper makes an empirical analysis of the relationship between the labour income share and both financialisation and other related variables in Portugal from 1978 to 2012. We estimate an equation for the labour share that includes standard variables (technological progress, globalisation, education and business cycle) and variables to capture the effect of financialisation. We formulate the hypothesis that the financialisation process may lead to a rise in the inequality of functional income distribution through three channels: the change in the sectorial composition of the economy (due to both the increase in the weight of the financial activity and the decrease in government activity), the diffusion of shareholder value governance practices and the weakening of trade unions. Our results show that the financialisation process as an indirect long-term effect on the labour share through its impact on government activity and trade union density. The paper also finds evidence supporting the traditional explanations for functional income distribution, namely globalisation, education and business cycle.

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“…Nonetheless, our sample covers the period when financialisation gained more influence in Portugal (Barradas et al, 2018). The proxy to inflation rate used here is the annual percent change (year-on-year) of the consumer price index, which was collected from the Bank of Portugal database.…”

Section: Methodsmentioning

confidence: 99%

“…(+351) 210 464 031 -Extensão 293101 | E-mail: dinamia@iscte-iul.pt | www.dinamiacet.iscte-iul.pt 4 al., 2018), which occurred simultaneously with a general decreasing trend of labour income (Barradas and Lagoa, 2017). Secondly, the analysis covers the period where financialisation becomes more preponderant in Portugal (Barradas et al, 2018). Note that the majority of empirical studies includes a period where financialisation was not so much expressiveeven in the USAtaking into account the general recognition that it emerges in the 1970s or 1980s (Kus, 2012;Sawyer, 2013;Vercelli, 2013;Tomaskovic-Devey et al, 2015).…”

Section: Introductionmentioning

confidence: 99%

Financialisation and the portuguese private consumption: two contradictory effects?

Gonçalves¹,

Barradas²

2018

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Fi in na an nc ci ia al li is sa at ti io on n a an nd d t th he e p po or rt tu ug gu ue es se e p pr ri iv va at te e c co on ns su um mp pt ti io on n: : t tw wo o c co on nt tr ra ad di ic ct to or ry y e ef ff fe ec ct ts s? ? Andreia Gonçalves Ricardo Barradas M Ma ar rç ço o 2 20 01 18 8 W WP P n n. .º º 2 20 01 18 8/ /0 02 2 DOCUMENTO DE TRABALHO WORKING PAPER 1 Andreia Gonçalves 2 Ricardo Barradas 3,4

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Financialisation in the european periphery and the sovereign debt crisis: the portuguese case

Abstract: FFi in na an nc ci ia al li is sa at ti io on n i in n t th he e E Eu ur ro op pe ea an n P Pe er ri ip ph he er ry y a an nd d t th he e S So ov ve er re ei ig gn n D De eb bt t C Cr ri is si is s: :

Cited by 10 publications

References 25 publications

Does the financial system support economic growth in times of financialisation? Evidence for Portugal

Does the financial system support economic growth in times of financialisation? Evidence for Portugal

Functional income distribution in portugal: The role of financialisation and other related determinants

Financialisation and the portuguese private consumption: two contradictory effects?

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