Product markets’ deregulation: a more productive, more efficient and more resilient economy?

Gustavo Monteiro, A.F. Gouveia, Sílvia Santos

Research output: Working paper


This paper assesses the impact of product market deregulation in upstream sectors on the productivity growth of firms in downstream sectors (i.e. those firms using the output of the reformed sectors as inputs in their production process). Relying on a firm level database for the period 2004-2014 covering all Portuguese firms, we show that reforms bring productivity gains already in the short-run and that are sustained in the long-run. The effects are more positive for those further away from the technological frontier and are also heterogeneous across sectors. In addition, reforms potentiate the exit of the least productive firms, improving the resource allocation in the economy by a process of selection – for the least productive, only those that have scope to catch-up with the frontier are able to remain. Finally, we show that the adoption of product market reforms in upstream sectors leads to a more resilient economy, better equipped to face adverse shocks.
Original languageEnglish
PublisherOECD Publishing
Publication statusE-pub ahead of print - 2017

Publication series

NameOECD Productivity Working Papers
ISSN (Electronic)2413-9424


  • Total Factor Productivity
  • Resilience
  • Exit Rates
  • Growth
  • Resource Allocation
  • Product Markets


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