05 February 2024

How Economic Restructuring Shapes Labour Markets and Inequality in Brazil

In his three PhD essays in Development Economics, Radu Barza empirically documents how, in Brazil, changes in local economies affect inequality in gender wage gaps, upward mobility, and gender disparities in career paths. He tells us more about his findings and their policy implications.

How did you come to choose your research topic?

When I decided to pursue a PhD in Economics, my goal was to further the understanding of inequalities in human capital formation.

Upon starting my PhD, I was introduced to various research ideas and potential topics to explore. Upward mobility and gender gaps in labour market outcomes are widely discussed in public discourse and research. Findings in these fields are essential for public policymakers to promote labour market equality and ultimately achieve economic prosperity. Brazil is an ideal place to study this research question. Municipalities and microregions in Brazil are at different stages of economic development, offering an opportunity to identify how shifts in local economies affect inequalities in labour market outcomes. Upward mobility and gender gaps are topics on the public and research agendas. Findings in these fields are highly needed for public policymakers to lead to equality in the labour market and eventually to economic prosperity. 

Your thesis comprises three essays. Can you describe the methodology, findings and policy implications of each essay?

In the three essays, I integrate development and innovation economics approaches to assess the effects of changes in local economic structures on labour market outcomes. By analysing Brazil’s Annual Social Information Report (RAIS) from 2003 to 2018, which includes over 900 million observations, I explore various aspects of inequalities in formal labour market outcomes.

In the first essay, I employ traditional decomposition methods, new measures of economic complexity and an instrumental variable estimate for local labour demand to study how the development of knowledge-intensive industries at the local level affects gender gaps in wages. My pivotal finding is that transitions to knowledge-intensive industries in local economies can significantly reduce gender wage gaps. This has profound social and political implications, suggesting that promoting competition for skilled labour in these industries contributes to gender wage equality. Policymakers can utilise this insight to prioritise the growth of knowledge-intensive sectors in economic development strategies, creating a high demand for skilled workers. This not only benefits economic progress but also addresses gender disparities in wages, aligning with broader societal goals of equality and inclusivity.

In the second essay, I use a two-stage procedure to assess the significance of local labour market characteristics in promoting upward mobility and I introduce new measures of skill segregation at the plant level. The findings show that collaboration between skilled and unskilled workers in urbanisation efforts promotes upward mobility. This insight is valuable for policymakers seeking to develop strategies that foster inclusive urban development and upward mobility.

In the final essay, I use a combination of the triple difference method and agglomeration measures to examine gender inequalities in wages, employment and career advancement among professionals in Brazil’s financial sector who experience job loss as a result of company shutdowns. The findings show that in places where coworkers can learn from each other and share knowledge across industries, there are no gender gaps in wages and unemployment after job displacement. This may encourage urban areas to promote gender equality in labour market outcomes through policies that facilitate knowledge exchange at the plant level and between industries. More generally, my findings provide policymakers detailed insights to guide interventions aimed at reducing gender gaps, promoting upward mobility, and understanding the dynamics of local development and inequalities in labour market outcomes.

What are you doing now?

I am currently part of the GCR Coordination Team at UNHCR in Geneva, where I work with the Senior Statistician to analyse the relevant data and co-author the Global Compact on Refugees (GCR) Indicator Report.

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Radu Barza defended his PhD thesis in Development Economics on 10 October 2023. Associate Professor Lore Vandewalle presided over the committee, which included Professor Ugo Panizza, Thesis Supervisor, and Associate Professor Anna Minasyan, Associate Professor, Faculty of Economics and Business, University of Groningen, The Netherlands.

Citation of the PhD thesis:
Barza-Nicoara, Radu-Nicolae. “Three Essays in Empirical Development Economics.” PhD thesis, Graduate Institute of International and Development Studies, Geneva, 2023.

An abstract of the PhD thesis is available on this page of the Geneva Graduate Institute’s repository. As the thesis itself is embargoed until October2026, interested readers can contact Dr Barza at for access.

Interview by Nathalie Tanner, Research Office.
Banner image by GrAl/