Regulatory reform and the Portuguese banking labour market: two decades later

We examine the impact of regulatory reforms (liberalisation/deregulation and privatisation) on the Portuguese banking earnings using both micro level and company data during the period 1982-2000. Our main finding suggests that after the introduction of both reforms, as the sector became actually profitable, workers were able to sustain their sizable wage advantage enjoyed during the regulated period. However, analysis for 1985-1990 indicates that during the deregulation phase, the increased competition slowed down the rise in the wage premium despite the arrival of high-paying firms in the market. Public employees, women, the most experienced and the least educated were among those who benefited the most from the regulatory reforms.