The impacts of the COVID-19 pandemic on the Portuguese economy
: a structural break analysis

  • Bruna Oliveira Pinto Santos (Student)

Student thesis: Master's Thesis


The COVID-19 pandemic could led to one of the worst crises in history (Barro, 2020). It would be the second crisis in the 21st century the Portuguese economy encounters but it is still unknown if its effects would be structural (permanent and related to the supply side) or cyclical (transitory and related to business cycle fluctuations and the demand side). To test for structural change, a linear regression model is used and the Chow test and Chow test for predictive failure are applied. The model uses quarterly data from various sources, ranging from the first quarter of 1998 to the third quarter of 2020, and is estimated in seasonal differences. It considers as dependent variable the natural logarithm of output per worker and as explanatory variables the natural logarithm of physical capital per worker, a time trend, and other variables on the supply and demand side as controls. A Chow test was first applied to the 2008 Global Financial Crisis, to rule out any interferences from this period. A structural break was found in the fourth quarter of 2010. Applying a Chow test for predictive failure to a subsample from the first quarter of 2011 to the third quarter of 2020, the null hypothesis of the pandemic not causing a structural break was rejected. T-tests were used to confirm the location of the breaks. The null hypothesis that a break did not occur was rejected for all the coefficients of the regression variables, pointing for the existence of supply side permanent effects.
Date of Award8 Jul 2021
Original languageEnglish
Awarding Institution
  • Universidade Católica Portuguesa
SupervisorFrancisca Guedes de Oliveira (Supervisor) & Leonardo Costa (Supervisor)


  • COVID-19
  • Structural break
  • Portuguese economy


  • Mestrado em Economia Empresarial

Cite this