Successful thesis defense for Juan Llavador Peralt
His thesis explores how the behavior of firms—especially large ones—shapes economic growth and the persistence of inflation.
On Friday June 12, IIES graduate student Juan Llavador Peralt successfully defended his doctoral thesis, “Firm Granularity, Growth, and Inflation Persistence: Essays in Macroeconomics.”
In his research, Juan shows that high market concentration can slow productivity growth. Using firm-level data from Sweden and other countries, he finds that when a few firms dominate an industry, resources are less likely to flow to the most productive firms. This “granular drag” reduces innovation and efficiency, with a 10 percentage point increase in concentration linked to a 3 percentage point drop in productivity growth over five years.
He further demonstrates that small differences between firms can have large aggregate effects. Even under similar conditions, persistent productivity gaps arise depending on how market shares are distributed. Using a novel modeling approach, he shows that a small number of large firms can disproportionately shape long-term growth patterns.
Juan’s work also provides a new explanation for why inflation tends to persist. He shows that when firms face costs of adjusting prices, they change prices at different times rather than continuously. This staggered adjustment creates a gradual, lagged response to shocks, making inflation depend on its own past and slowing its return to normal levels.
Overall, his thesis highlights how macroeconomic outcomes are deeply influenced by firm-level behavior, offering new insights for understanding growth and designing effective policy.
Juan will next join the Bank of Portugal as a Research Economist.
Miguel León-Ledesma, University of Exeter Business School, kindly acted as opponent, providing a thorough and engaging discussion.
Last updated: 2026-06-12
Source: Institute for International Economic Studies