Margarida Abreu, António Afonso, Paulo Brito, Cândida Ferreira, Luís Costa, Nikolay Iskrev, Pedro Leão, Ettore Panetti, Paulo Trigo Pereira, Álvaro Pina, Jorge Santos, Miguel St. Aubyn, Caterina Mendicino, Sudipto Karmakar, Luís Catão

This area has 3 active research lines. In what follows, we consider each line in turn.

‘Fiscal Policy’
1. To study fiscal forecasting in Europe, with a special focus on the economic, political and institutional determinants of forecast errors (A. Pina).
2. To assess the linkages between sovereign yield spreads and credit ratings, and the determinants of EMU government bond yields (A. Afonso).
3. Additional work is planned regarding fiscal regimes in the European Union (A. Afonso).

‘Macroeconometric Modelling’
1. To make progress on the fundamentals behind recent Portuguese economic growth. This is joint research of M. St Aubyn and V. Gaspar (BEPA, EU)
2. To study the relationship between public administration modernisation and economic growth in developed countries (A. Afonso and M. St. Aubyn).
3. To pursue research on the measurement of the macroeconomic rates of return of public, private and human capital investment (A. Afonso and M. St. Aubyn).
4. To pursue the research line in efficiency measurement (A. Afonso and M. St. Aubyn).
5. To study business cycle synchronisation in monetary unions, comparing Europe with other currency areas regarding output gap correlations and core vs periphery patterns (A. Pina and A. Lopes, ISCTE, UNIDE-ERC and Dinâmia).

‘Macroeconomic Theory and Dynamics’
1. To continue ongoing work on several topics related to macroeconomic dynamics.
2. To set up a regular workshop on the macroeconomics of imperfect competition, firm dynamics and macroeconomic dynamics or on the mathematics of macroeconomic dynam

Rosa Borges, Mário Centeno, Paula Fontoura, Sofia Franco, Filomena Garcia, Teresa Garcia, João Gata, Álvaro Novo, Francisco Nunes, Luca Opromolla, Joana Pais, José Pedro Pontes, Fernando Martins, Patrícia Melo

This research group had 8 active research lines with the objectives that follow:

‘Financial Modelling’
1. To develop research on the topic of financial aspects of European banking, European insurance, Portuguese pension funds, and Portuguese investment funds.
2. More specifically, to assess efficiency and productivity.
3. To investigate governance aspects on banking, insurance, and pension funds.

‘Game-Theoretic Analysis of Economic Geography’
Using a partial equilibrium analysis, to explore:
1. The location of vertically linked industries in asymmetric countries.
2. The complex integration strategies of multinational firms, beyond the well-known models of horizontal and vertical foreign direct investment.

‘Labor and Demographic Economics’
1. To understand the impact of the minimum wage policy on labor market outcomes.

‘Matching and social networks: theory and applications’
1. To explore dynamic aspects of network formation (study the stability and efficiency of networks when individuals can enter or exit the network).

‘Optimal Unemployment Insurance (UI): Income and substitution effects’
1. To model UI optimality by introducing both an income and a substitution effects.
2. To explore the Portuguese labor supply behavior, uncovering some key elasticities.
3. To characterize the impact of the substitution and income of UI over the distribution of wages.

‘Poverty Dynamics and Social Exclusion’
1. To study data on income poverty and deprivation dynamics.
2. To assess the redistributive effects of social transfers on economic poverty.
3. To propose categorical indicators in the field of child poverty and deprivation dynamics.

‘Risk-Aversion, Information, and Entry: An Experimental Study on Networks’
1. To contribute to the experimental literature on networks.
2. More specifically, to study in the lab the impact of different preference intensities and degrees of risk aversion on the performance of matching mechanisms.

‘Wage Formation: Institutions, Worker Flows and the Business Cycle’’

1. To study job and worker flows and their relationship with employment protection legislation.

João Ferreira do Amaral, Tanya Araújo, João Dias, Manuel Mira Godinho, João Carlos Lopes, Francisco Louçã, Sandro Mendonça, Susana Santos

This group contained 5 active research lines. In what follows, we list their main aims for 2011in turn.
‘Economic Development, Technological Change, and Growth’
1. To analyse the role played by the factor intensity-condition in a dynamic general equilibrium with banks.
2. To incorporate consumer durables in a dynamic general equilibrium analysis of the business cycle.

‘Innovation Systems’
1. To perform an economic analysis of IPR.
2. To analyze innovation systems.
3. To analyze industry dynamics, with emphasis on the survival and growth of new technology-based firms.
4. To perform an historical analysis of the innovation structure behind the British leadership in building large steamships, 1813-1913.
5. To explore forward analysis approaches as mechanisms for stakeholder coordination in the governance of innovation.

‘Mathematical and Quantitative Methods’
1. (On ISEG’s artificial market) To develop an artificial market, which we will compare with existing theoretical models and validate by comparing with the extensive amount of data we have available at UECE-ISEG from DataStream (Thomson Reuters).
2. Basing on previous experience, to incorporate in the artificial market the interaction of adaptive agent strategies with the actual mechanisms of price setting in real markets (the limit order book); and to characterize how non-rational behavior of human groups and individuals may be incorporated in market models to obtain a better understanding of current market events.
3. (On opinion dynamics) To characterize the interplay of opinion dynamics and the emergence of clusters of divergent opinions.

‘Measuring and Modelling the Activity of the Society’
1. (Phase 4) Gather the main results of the theoretical and empirical approach carried out in the previous three phases, deepening the matrix approach to economic and human flows and stocks.

‘Multisectoral Approaches to Growth and Complexity’
1 To develop economic and ecological measures of complexity, using multisectoral tools and models.
2 To analyze the effects of demand and supply shocks on the economy, using a new concept of multipliers (Euclidean distance multiplier).
3 To study productivity and wages.
4 To explore economic integration and multinational investment.

‘Schools of Economic Thought and Methodology’
1. To investigate the confrontation between Ronald A. Fisher and the alternative statistical approach by Jerzy Neyman and Egon Pearson, and the impact of the polemics in economics.
2. To discuss the historical parallel between the introduction of modern concepts of probability in economics and the generation of simulations and game theory, namely through the work of John von Neumann.
3. To assess the contribution of Robert Solow to the economic analysis of cycles and dynamics.
4. To discuss the early contributions to the study of complexity in economics, namely in the early twentieth century.