The traditional approach makes investment in innovation constrained by market structure. This paper explores the causality from innovation to market structure. Omitting this causality direction on empirical models may explain empirical problems and contradictions on these models.

Based on the theoretical models of Helpman and Krugman (1985), Falvey and Kierzkowski (1987) and Flam and Helpman (1987) and on the empirical studies of Greenaway, Hine and Milner (1994) and Hummels and Levinsohn (1995), we use a static and dynamic panel data approach to test the...

The paper investigates the “widest cleft”, as Savage put it, between frequencists in the foundation of modern statistics: that opposing R.A. Fisher to Jerzy Neyman and Egon Pearson. Apart from deep personal confrontation through their lives, these scientists could not agree on methodology,...

This paper identifies different groups in a cost function framework of thermo energy plants belonging to EDP-Electricity of Portugal. In particular, we have clustered the sample - comprising data for years 1987 to 2006 - into two groups. To do so, we have implemented a stochastic frontier latent...

This paper investigates the link between fiscal policy shocks and movements in asset markets using a Fully Simultaneous System approach in a Bayesian framework. Building on the works of Blanchard and Perotti (2002), Leeper and Zha (2003), and Sims and Zha (1999, 2006), the empirical evidence for...

Knowledge of the quantifiable side of a market economy greatly depends on the form of macro-economic modelling that is used. This, in turn, should have an underlying database. Such a database should include the interrelated subsystems that exist within that economy and, at the same time, it...

In a two-region economy, two upstream firms supply an input to two consumer goods firms. For two different location patterns (site specificity and co-location of the suppliers), the firms play a three-stage game: the input suppliers select transport rates; then they choose outputs; finally the...

This paper tests the relation between immigration and Portuguese bilateral trade. Using a panel data analysis, the results show that the stock of immigrants has a positive effect on Portuguese exports, imports and bilateral intraindustry trade. The underlying assumption is that immigration...

The objective of this paper is to estimate the impact of the Portuguese Minimum Guaranteed Income Program (RMIG). We estimate its impact on the distribution of household incomes and poverty as well as the size of government expenditures necessary to finance the program. The baseline adopted is...

The endogeneity of optimum currency areas criteria has been widely studied since Frankel and Rose (1998) seminal paper. Literature normally suggests that there is a positive relationship between trade and business cycles correlation. This paper develops work on this subject (Silvestre and...