Hostname: page-component-586b7cd67f-rcrh6 Total loading time: 0 Render date: 2024-11-23T21:47:13.579Z Has data issue: false hasContentIssue false
  • English
  • Français

‘No country for old men’? The multiplier effects of pensions in Portuguese municipalities

Published online by Cambridge University Press:  19 December 2018

Paulo Reis Mourao Open the ORCID record for Paulo Reis Mourao [Opens in a new window]  and
Cilina Vilela
Paulo Reis Mourao*
Affiliation:
Department of Economics & NIPE, Economics & Management School, University of Minho, 4700Braga, Portugal
Cilina Vilela
Affiliation:
UTAD, Vila Real, Portugal
*
*Corresponding author. E-mail: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

One of the major findings of this paper, which studied the multiplier effects of pensions received at each Portuguese municipality since 2003, is that pensions stimulate the incomes of municipalities. We studied these effects also considering the spillovers from/to the surrounding areas. After discussing several models of spatial analysis, we chose the Dynamic Spatial Durbin Model. Our results were obtained after considering a proper set of control variables.

Keywords

Keynesian multiplierpensionsPortuguese municipalitiesspatial analysisH55H75C21
Type
Article
Information
Journal of Pension Economics & Finance , Volume 19 , Issue 2 , April 2020 , pp. 247 - 261
Copyright
Copyright © Cambridge University Press 2018

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Anuário Financeiro vv Aa (2016) Anuário Financeiro dos Municípios Portugueses. Ordem dos Contabilistas Certificados, Lisboa.Google Scholar
Azevedo, J, Inchauste, G and Sanfelice, V (2013) Decomposing the recent inequality decline in Latin America. Policy Research Working Paper 6715. Washington, DC: World Bank.CrossRefGoogle Scholar
Barigozzi, M, Alessi, L, Capasso, M and Fagiolo, G (2009) The Distribution of Households Consumption Expenditure Budget Shares Working Paper 1061. European Central Bank/Eurosystem.Google Scholar
Beckmann, M (1971) Some aspects of economic diffusion processes. In Kuhn, H and Szego, G (eds), Differential Games and Related Topics. Amsterdam: North Holland, pp. 313–323.Google Scholar
Biles, J (2003) Using spatial econometric techniques to estimate spatial multipliers: an assessment of regional economic policy in Yucatán, Mexico. The Review of Regional Studies 33.2, 121–141.Google Scholar
Burda, M and Wyplosz, C (1993). Macroeconomics: A European Text. Oxford: Oxford University Press.Google Scholar
Chen, T, Lesson, G, Han, J and You, S (2017) Do state pensions crowd out private transfers? A semiparametric analysis in urban China. Chinese Sociological Review 49, 293–315. DOI: 10.1080/21620555.2017.1298968.CrossRefGoogle Scholar
Corredera, J (2005) Regional Labor Markets, Unemployment and Inequality in Europe (PhD Dissertation). University of Texas, Austin.Google Scholar
Das, D (2016) Determinants of current account imbalance in the global economy: a dynamic panel analysis. Journal of Economic Structures 5, 1–24.CrossRefGoogle Scholar
Dasgupta (2011) Mother or child? Intra-household redistribution under gender-asymmetric altruism. Journal of Globalization and Development 2, Article 2.Google Scholar
Delgado, M and Robinson, P (2015) Non-nested test of spatial correlation. Journal of Econometrics 187, 385–401.CrossRefGoogle Scholar
Diris, R, Vandenbroucke, F and Verbist, G (2017) The impact of pensions, transfers and taxes on child poverty in Europe: the role of size, pro-poorness and child orientation. Socio-Economic Review 15, 745–775. DOI: 10.1093/ser/mww045.Google Scholar
Dosi, G, Pereira, MC, Roventini, A and Virgillito, ME (2017) When More Flexibility Yields More Fragility: the Micro foundations of Keynesian Aggregate Unemployment. Journal of Economic Dynamics and Control Online first DOI: http://dx.doi.org/10.1016/j.jedc.2017.02.005 – previous ISI Growth Working Paper Series (5/16). Available at http://www.isigrowth.eu/2016/02/18/when-more-flexibility-yields-more-fragility-the-microfundations-of-keynesian-aggregate-unemployment/.CrossRefGoogle Scholar
Ebbinghaus, B and Gronwald, M (2011) The changing public–private pension Mix in Europe: From path dependence to path Departure In Ebbinghaus, B (ed.), The Varieties of Pension Governance. Pension Privatization in Europe, Oxford: Oxford University Press, pp. 23–56.CrossRefGoogle Scholar
Fan, E (2010) Who benefits from public old age pensions? Evidence from a targeted program. Economic Development and Cultural Change 58:297–322.CrossRefGoogle Scholar
Frasquilho, D, Matos, M, Currie, C and Caldas de Almeida, J (2016) Young people living with unemployed parents during a labour market-crisis: how do Portugal and Scotland compare? Child Indicators Research 10, 1135–1144. DOI: 10.1007/s12187-016-9436-5.CrossRefGoogle Scholar
Gatzlaff, D and Tirtiroglou, D (1995) Real estate market efficiency: issues and evidence. Journal of Real Estate Literature 3, 157–189.Google Scholar
Griffith, D, Chun, Y, O'Kelly, M, Berry, B, Haining, R and Kwan, M (2012) Geographical analysis: its first 40 years. Geographical Analysis 45, 1–27.CrossRefGoogle Scholar
Gurria, J, Nieto, A and Hernandez, A (2013) The new rural dynamics in Southern Spain (Extremadura). In Frutos, L (ed.), New Ruralities and Sustanaible use of Territory. Zaragoza: Prensas Universitarias de Zaragoza and International Geographical Union (IGU), pp. 383–404.Google Scholar
Haining, R (1986) Small area aggregate income models: theory and methods with an application to urban and rural income data for Pennsylvania. Regional Studies 21, 519–529.CrossRefGoogle Scholar
Haining, R (1987) Income diffusion and spatial econometric models. Geographical Analysis 19, 57–58.CrossRefGoogle Scholar
Hardy, M (2009) Income inequality in later life. In Uhlenberg, P (ed.). International Handbook of Population Aging. London: Springer, pp. 493–518.CrossRefGoogle Scholar
Herz, B and Hohberger, S (2013) Fiscal policy, monetary regimes and current account dynamics. Review of International Economics 21, 118–136.CrossRefGoogle Scholar
Hill, C and McDonnel, M (2016) Short and Long Term Investors (and Other Stakeholders Too): Must (and Do) Their Interests Conflict? The CLS BlueSky Blog. Columbia Law School.Google Scholar
INE (2015) Estudo sobre o poder de compra concelhio, Instituto Nacional de Estatística, Lisboa.Google Scholar
Knutsen, C and Rasmussen, M (2017) The autocratic welfare state: old-age pensions, credible commitments, and regime survival. Comparative Political Studies, June 2017. DOI: 10.1177/0010414017710265.Google Scholar
Kuivalainen, S, Rantala, J, Ahonen, K, Kuitto, K and Palomäki, L-M (eds.) (2017) Pensions and Pensioners’ Economic Welfare 1995–2015. Helsinki: Finnish Centre for Pensions.Google Scholar
Lee, K (1999) Developing Towns and Cities: Lessons From Brazil and Philippines. Washington: World Bank Publications.CrossRefGoogle Scholar
Lee, LF and Yu, J (2016) Identification of spatial durbin panel models. Journal of Applied Econometrics 31, 133–162.CrossRefGoogle Scholar
LeSage, JP (2014) What regional scientists need to know about spatial econometrics. Review of Regional Studies 44, 13–32.Google Scholar
LeSage, JP and Pace, RK (2009) Introduction to Spatial Econometrics. Boca Raton: CRC Press/Taylor & Francis.CrossRefGoogle Scholar
Marcis, J and Veseth, M (1981) Aggregate demand. In Veseth, M (ed.). Test Bank for Introductory Economics and Introductory Macroeconomics and Introductory Microeconomics. New York: Academic Press, pp. 53–61.CrossRefGoogle Scholar
Martin-Rodriguez, M and Ogawa, H (2017) The empirics of the municipal fiscal adjustment. Journal of Economic Surveys 31, 831–853. DOI: 10.1111/joes.12179.CrossRefGoogle Scholar
Matkin, D, Chen, G and Khalid, H (2016) The governance of public pensions: an institutional framework. Administration & Society 51, 91–119. DOI: 10.1177/0095399715621945.CrossRefGoogle Scholar
Modesto, L and Neves, J (1993) Hysteresis and sluggishness in Portuguese unemployment, 1977–88. International Review of Applied Economics 7, 197–207.CrossRefGoogle Scholar
Mourao, P (2004) As disparidades regiona is em Portugal: uma sugestão a partir de índices sintéticos; Revista Redes (Universidade de Santa Cruz do Sul); 9; 3; September–December; 11–33.Google Scholar
Mulvey, J and Purcell, P (2008) Converting Retirement Savings Into Income: Annuities and Periodic Withdrawals. Washington, DC: Congressional Research Service.Google Scholar
Mummery, A and Hobson, J (1889) The Physiology of Industry: Being an Exposure of Certain Fallacies in Existing Theories of Economics. Harvard: Harvard University.Google Scholar
Pede, VO, Florax, RJ and Holt, MT (2008) Modeling non-linear spatial dynamics: A family of spatial STAR models and an application to U.S. economic growth. 2008 Annual Meeting, July 27–29, 2008, Orlando, Florida 6518, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).Google Scholar
Peinado, P and Serrano, F (2017) Unemployment, wages and pensions. International Review of Applied Economics 31, 670–680. DOI: 10.1080/02692171.2017.1299116.CrossRefGoogle Scholar
Popov, N, Chigisheva, O, Nikitina, O and Vorontsova, G (2015) Aging population and tourism: socially determined model of consumer behavior in the ‘senior tourism’. Procedia – Social and Behavioral Sciences 214, 845–851.Google Scholar
PORDATA (2016). Various data/indicators. Available at through http://www.pordata.pt.Google Scholar
Razin, A and Sadka, E (2007) Aging population: the complex effect of fiscal leakages on the politico-economic equilibrium. European Journal of Political Economy 23, 564–575.CrossRefGoogle Scholar
Reil-Held, A (2006) Crowding out or crowding in? Public and private transfers in Germany. European Journal of Ageing 22, 263–280.Google Scholar
Rios, V, Pascual, P and Cabases, F (2017) What drives local government spending in Spain? A dynamic spatial panel approach. Spatial Economic Analysis 12, 230–250.CrossRefGoogle Scholar
Ritter, L and Leijonhufvud, A (1970) On Keynesian economics and the economics of Keynes. The Journal of Finance 25, 188.CrossRefGoogle Scholar
Rodrigues, C and Andrade, I (2014) Ageing and poverty: how older Portuguese adults became less poor in the noughties. European Journal of Ageing 11, 285–292.CrossRefGoogle ScholarPubMed
Rutherford, M and Desroches, C (2008) The institutionalist reaction to Keynesian economics. Journal of the History of Economic Thought 30, 29–48.CrossRefGoogle Scholar
Sebova, L, Marcekova, R and Simockova, I (2016) Health tourism in the context of active ageing of Slovak population. Economic Annals-XXI 156, 109–111.Google Scholar
Simões Lopes, A (1979) Des envolvimento Regional – Problemática, Teoria, Modelos. Lisboa: Fundação Calouste Gulbenkian.Google Scholar
Standing, G (2008) How Cash Transfers Boost Work and Economic Security. DESA Working Paper No. 58ST/ESA/2007/DWP/58.Google Scholar
Terasvirta, T and Anderson, HM (1992) Characterizing nonlinearities in business cycles using smooth transition autoregressive models. Journal of Applied Econometrics 7, S119–S136.CrossRefGoogle Scholar
Tırtıroğlu, D, Tanyeri, B, Tırtıroğlu, E and Daniels, K (2012) Tiebout-Extended Regulatory Competition and Cross-Fertilization in Bank Performance. Working Paper. Bilkent University.Google Scholar
Vaittinen, R and Vanne, R (2017) Finland's slow recovery from the financial crisis: a demographic explanation. Journal of the Economics of Ageing June 2017. DOI: 10.1016/j.jeoa.2017.06.003.CrossRefGoogle Scholar
Veiga, L and Veiga, F (2007) Political business cycles at the municipal level. Public Choice 131, 45–64.CrossRefGoogle Scholar
Wang, Y, Kockelman, K and Wang, C (2013) The impact of weight matrices on parameter estimation and inference: a case study of binary response using land use data. Journal of Transport and Land Use 6, 75–85.CrossRefGoogle Scholar
Weckroth, M, Kemppainem, T, Fyhn, J and Sorensen, L (2015) Predicting the gross domestic product (GDP) of 289 NUTS regions in Europe with subjective indicators for human and social capital. Regional Studies, Regional Science 2, 311–330.CrossRefGoogle Scholar
Zadoia, O (2017) Transformation of savings into investments: Role of financial intermediaries. Naukovyi Visnyk Natsional nohoHirnychoho Universytetu, January 2017.Google Scholar
Zaghdoudi, T and Maktouf, S (2017) Monetary policy and bank excessive risk-taking. Oeconomica 13, 157–173.Google Scholar
Zanglein, J (2005) Labors’ comeback: pensions and jobs (review). Labor Studies Journal 30, 92–93.Google Scholar