Lobo, Flora Cunha; Ramos, Pedro; Lourenco, Oscar - In: International Journal of Monetary Economics and Finance 4 (2011) 4, pp. 390-409
This paper analyses the factors behind the financial distress of local government in Portugal. A Probit model is used to estimate the probability of a municipality entering into a financial recovery contract, regulated by the Portuguese Local Finance Law. Empirical results indicate that both...