Nova News 7th edition

Edition #7 - October, 2012

Nova hosted in its campus a musical event: Nova Música, with many concerts for all musical tastes

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“Portugal: All To-gether Now” reviews the recent events on the portuguese world of economics and politics. P. 6

NOVA Students talk about their unforgetable experiences, hard work and leisure time they had this Summer.

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WHAT HAVE YOU DONE THIS SUMMER?

October, 2012October, 20122 3NEWSEDITORIAL

Nova News started in the spring of 2011, when a group of friends (where I was included) decided that Nova SBE lacked an essential element of every community: a newspaper. We wanted to create plat-form where students could express their opinions, where the achievements of students, alumni and the school itself could be noted, as well as provide information about events,

While Portugal is considered a very

good country to enjoy a hot Summer, many Nova students take advantage of the extra time to add more unique experiences to their curriculum. While taking professional internships is a demand-ing but relatively com-mon Summer activity, we searched for even more unique experiences that we describe here: a sum-mer school in the Olym-pic London and the Mo-bile Banking internships in Mozambique.Who knows, maybe our readers will gain new ideas for their next summer ex-perience.

Ana Lopes

or clubs, or anything that was potentially interesting in Nova SBE. Surprisingly, we recruited enough peo-ple to make it happen. It wasn’t always easy to jug-gle the demanding work-load at Nova with such a project, but in the end I believe it was an enriching experience for everyone involved.

While working on Nova News, I often wondered whether this project would

in capable hands. Because that, more than ephem-eral fame, is what every-one hopes their projects to achieve: A life of their own.

So, to those who have chosen to carry on this endeavor, I thank you and wish you the best of luck in the future.

Rafael Barbosa

4 hours and 30 minutes of classes each day may seem like a small price to pay for 3 weeks of vaca-tion spent in the Olympic London. However, Ana Rita Borges’s experience in LSE’s (London School of Economics) summer school gave her both the demanding workload of a prestigious institution and the unique environ-ment of a London, “the city that never sleeps”, full of tourism and eth-nic diversity.

This experience exceed-ed Ana Rita’s expecta-tions. At first, the fear of being alone in a new city appeared as an ob-stacle to adding value to her curriculum. How-ever, those fears were put to rest, partly due to the few time she was free to visit London due to the intensity of the summer school. The Economet-rics course at LSE re-quired the reproduction of an empirical exercise, through whichshe could see in practice the as-sumptions, tests and

survive after me and my friends left the school and proceed to our profession-al lives. Considering that it might not do so, was cer-tainly a prospect that sad-dened me.

Now, at the start of this new academic year and though almost none of the initial members remain, Nova News will continue, and nothing would make me prouder than if it goes on for many more years

“What have you done this summer?”

NOVA students talk about life, academic and professional expe-riences they got to live during this summer.

“London never stops, it never sleeps”

demonstrations she had learned in Nova. Not only is it a background to re-sume this semester, it was also a great opportunity to get ideas for the up-coming thesis.

At the same time, the Olympic Games that took place in London were the biggest event this summer and Ana Rita had the op-portunity to pause from

studying by giving sup-port to the Portuguese athletes.

Despite being a first expensive experience abroad, Ana Borges “loved it”. “My horizons have opened up; the world seems like a much bigger place now”.

A Life of Their Own

October, 2012October, 20124 NEWS

Few have the oppor-tunity to learn new things, work in a new environment, talk to different people and travel to differ-ent countries. Helena, Rute and Tiago had all these experiences in one when they partici-pated in the NovAfri-ca internships this summer.

Their job was to sur-vey locals as a team. The data collected was used on the mobile banking project in the context of Novafrica’s research project enti-tled “Mobile Banking - introduction in Mo-zambique”. However, this was no easy task.

For Helena, while it

had a tough workload, it was also a very enrich-ing experience. Bein her second time in the coun-try, she still found “walk-ing in the city and living there” very pleasant. Not only was it a good expe-rience to add to her cur-riculum, she also had the inside experience of

developing a project this big, in the research area that she prefers.

On the other hand, Rute, being a first timer in Mo-zambique, suffered a little of the so called “cultural shock”. It began with a 11 hour flight, formation and 33 days in the field.

Between the surveys, management of her team and the com-munity musical the-ater pieces, Rute had to climb a tree in the middle of nowhere to contact with her team, after her car broke down.

For Tiago, the different society was his biggest shock. Not only did he understand this with the surveys in the field work but also by talk-ing and befriending locals, whose trust he gained by taking some risks. But all of these experiences made him appreciate the experi-ence even more.

“Maningue Nice!”, the Mozambique experience

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The festival opened with the Brass Quintet

of the Orquestra Metro-politana de Lisboa and the Choir of the NOVA Uni-versity bringing the music of great classical compos-ers as Bach, Vivaldi and Mozart to the church of Santo António de Cam-polide. The music went on at the Fado stage where Portugal’s most tradition-al music was interpreted by a group of young and promising singers includ-ing NOVA SBE’s student Carmo Moniz Pereira.The Portuguese Tribute to Nina Simone started the party in the Jazz stage with an honest homage

to one of the most iconic jazz singers of all time. Along with the excellent performance of the mu-sicians the highlight of the concert was the in-teraction with the crowd which reached its peak when during “Feeling Good” the singer Selma was joined by one mem-ber of the crowd to sing the chorus. Up next were the Groove Quartet who, as the name says, consists of 4 musicians playing groovy music that made the crowd have as much fun listening and dancing to it as they had playing. Their concert was a mas-terclass on Funky-Jazz

and besides their original songs they payed homage to the Beastie Boys with a cover of the track Root Down. The party finished with the duo of DJ’s Celeste/Mari-posa bringing the best of African groovy music with their set Afro-Baile.The bands play-ing in the main stage attracted the majority of the 4.000 persons

who attended the festival. The Kafkas, Ci-clo Preparatório and Bi-ancard, three young indie-rock bands from Lisbon showed good songwriting skills and attitude. But the stars of the night were Capitão Fausto and Os Pontos Negros, two of the main bands of the portuguese rock scene, who de-lighted their fans with tight and enthusiastic per-formances of their songs.In general, the festival was a big success. It was very well orga-nized and the va-riety of musical styles present in the various stages brought a large audience to the festival (including

Nova Música

mainly students but also some faculty members) united by the passion for live music. Summing up, portuguese music is alive and well and this should be the first of many edi-tions of the NOVA Música festival.

Miguel Aguiar

NEWS

Music all around the campus, something like NOVASBE as ever seen

October, 2012October, 2012

TThe previous quota-tion refers to what is

known in the literature as the “Juncker Curse”, which conveys the generalized belief that reformist gov-ernments cannot succeed in being re-elected. How-ever, a paper produced by the European Commis-sion [Buti et al. (2008)], presents empirical evi-dence against this elector-al fate. Moreover, it ex-plains that well functioning financial mar-kets bring future benefits of structural reforms to the present and, thus, compensating some pos-sible short-run costs. As a consequence, the elector-ate will tend to reward and not to punish those re-formist governments. I found this small intro-duction appropriate given the current economic and political context we are living today. In April of 2011, Portugal asked the European Union for a fi-nancial bailout and, before leaving office, the former Prime Minister negotiated the financial assistance, provided on the basis of a

structural reform package supported by strict condi-tionality – the Memoran-dum of Understanding.

In the last weeks of Sep-tember, the climate of so-cial stability was seriously compromised. The an-nouncement of a proposal

to reduce labor costs by cutting employers’ social security contributions by 5.75 percentage points (pp), jointly with a corre-sponding 7 pp increase in workers’ social contribu-tions, represented a turn-ing point in the govern-ment action. The vast public opinion con-demned the measure and popular demonstrations against austerity followed all over the country, show-ing an unprecedented public backlash. What was the problem? What can justify such a sudden change in public opinion? From my point

of view, the way the mea-sure was announced and the way the government was planning to finance it can be pointed out as the

major justifications. The measure was also misun-derstood and subverted

Portugal: All Together Now![When talking about economic reforms] “We all know what to do, but we do not know how to get re-elected once we have done it.”

Jean-Claude Juncker

6 OPINION

“(...) the electorate will tend to reward and not to punish

those reformist governments”

“What can justify a sudden change in

public opinion? From my point of view, the way the measure was announced and the way the government

was planning to finance it (...)”

7OPINION

with a malevolent collabo-ration of the media. Pas-sos Coelho was also inex-perienced and naïve. He should not have an-

nounced more austerity measures 15 minutes be-fore an important football game and then decided to go out for a concert. It is clearly a case of public re-lations failure. After all, any potential merits of the so called “fiscal devalua-tion” were immediately eliminated. The idea of cutting wage costs was de-signed to contain unem-ployment growth, increase

competitiveness and en-courage investment. In-stead of discussing alter-native proposals, we are lost in unproductive dis-cussions about politics: hypothetical Prime Minis-ter’s resignation, the lack of confidence inside the coalition in power and an eventual government re-shuffle. It is important to remember that the eco-nomic costs always far ex-ceed the political costs as-sociated with one of those scenarios of political cri-sis. The circumstances have now forced Passos Coelho into an embarrass-ing U-turn. On the one hand, retreating may be considered as a form of humility and cleverness. On the other hand, it may also be considered as a sign of weakness…I hope we will return to normality. These are com-plex, exceptional and chal-lenging times. There is no doubts that we are living a

tremism are now our ene-mies. We are all in the same boat and we should bring the boat to a safe harbor.

Tiago Lopes da Silva

“Instead of discuss-ing alternative pro-

posals, we are lost in unproductive discus-sions about politics

(...)”

decisive moment in our collective existence. The reforms cannot be seen as war between factions. Moreover, they should be simple, clear and well ex-plained. Populism and ex-

New Coffee Machine

October, 2012October, 20128

When “The Simp-sons” were created

in 1989, I believe that the belly fat of Homer Simp-son was not meant to in-spire Americans. How-ever, it seems to have done it somehow – and note that I am not pretending to offend Americans in any weight, shape or form. The facts are clear: as of 2008, the Centres for Dis-ease and Control Preven-tion of the United States reported that almost 70% of the population was overweight (defined as BMI>25kg/m2), a clearly high value at a global scale.

This essentially means that the percentage of over-weight population has risen from 40% to 70%, in only 48 years, as shown in the graph.The increasing trend in overweight in the United States is quite worrisome as the World Health Or-ganization estimated that overweight and obesity are the fifth leading risk for global deaths, killing 2,8 million adults per year directly and several indi-rectly by increasing the burden of diseases such as diabetes and heart prob-lems.

Given this, US policy makers are increasingly concerned with the solu-tions for the epidemic of overweight. Since a na-tional claim is that the low real prices for many high-calorie foods encourage people to buy and con-sume more of these foods, one of the prevalent ques-tions has been whether food taxes and subsidies can be applied to certain food categories to increase or reduce their consump-tion. For this task, know-ing how sensitive consum-ers are to price changes is a key.

The following table illus-trates the price elasticity of different food subcat-egories in the US in 2005. Using “oils & fats” as a proxy for unhealthy food and “fruits” as a proxy for healthy food, we can see that both types are not

Americans need to diet, but the Government cannot help

OPINION

While overweight America has understood their habits are not healthy, its government’s measures are not efficient

“I believe that the belly fat of Homer Simpson was not meant to inspire

Americans. However, it seems to have done

it somehow (...)”

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price sensitive – their de-mand is actually quite in-elastic.From this outcome, tax-ing unhealthy food seems good in terms of revenue generated by the govern-ment, as tax on oils and fat is likely to cause a minimal change in its consump-tion, ceteris paribus. How-ever, it will not be efficient for the purpose it aims to achieve, as the consump-tion of oils and fats will be unaltered.As for subsidies to healthy food, they are also likely to be very inefficient, and past research in the field

has already shown this. In-deed, a study by the Unit-ed States Department of Agriculture in 1996-1997 found that a 10% subsidy on vegetables, fruit and dairy products would in-crease consumption of these foods only margin-ally, as table 2 shows.To conclude, this very short analysis illustrates how unlikely it is that the US Government decreas-es overweight prevalence just based on instruments such as taxes and subsi-dies. The responsiveness of food demand to prices is in general very small

and conditioned by other factors, namely interest in nutrition, taste preferenc-es, need for convenience, culture and emotions.As the intelligent Lisa Simpson would say: “America, do not wait for the Government to help you losing weight. If you wish to grow thinner, di-minish your dinner. On your own.”

Ana Rita Borges

Sources: USDA, Econom-ic Research Services, Cen-tres for Disease and Con-trol Prevention

This article was writ-ten for Microeco-nomic Policy Analy-sis. For more articles written by Econom-ics Masters students please visit:

ht tp : / /novawork -board . wordpress .com/

OPINION

October, 2012ENTERTAINMENT

NOVA News TeamExecutive Staff:Ana Lopes

Journalists:Ana Lopes, André Coelho, Clara Gil, Hetal Kanji, Luís Filipe, Miguel Aguiar,

Rafael Barbosa and Tiago Silva

Trivia

Activities for November 2012

30th October (6 pm): Oktoberfest (next to A14)

31st October: Halloween Party

8th November (5 pm): “Elevator Pitch”, Nova Consumer Goods Club

15th November (5 pm): “Speed Networking”, Nova Consumer Goods Club

We need youto join our writing team

Send an email to [email protected] if you would like to contribute to Nova’s newspaper

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