Balázs Muraközy

Address: University of Liverpool Management School, Chatham St, Liverpool L69 7ZH




I am a senior lecturer (associate professor) at the University of Liverpool Management School where I am also the Director of Studies for the PhD in Economics. I am also affiliated with the Centre for Economic and Regional Studies in Budapest. I received my PhD at the Central European University. My research focuses on how firms' decisions on technology, innovation or internationalization are related to outcomes for workers, firms and the the economy in general. Methodologically, I mostly work with large linked microdata.  

My CV is here.

Books and other publications

In Hungarian

Working papers and drafts 

Technological Change and Skill Demand in Non-Competitive Labor Markets (with Attila Lindner, Balázs Reizer and Ragnhild Schreiner) -- Revise and Resubmit at the American Economic Review

We quantify the contribution of firm-level technological change to skill demand and aggregate inequality in the presence of imperfect competition in the labor market. We show that skill-biased technological change increases both the firm-level skill ratio and the skill premium, while other shocks (e.g.  firm-specific output demand shocks) cannot explain the increase in both outcomes. We exploit administrative data and a large survey measuring a broad class of firm-level technological changes from Hungary and Norway. We estimate that the aggregate college premium increases by 6.1% in Norway and by 13.8% in Hungary as a result of the skill bias in technological change.

THE FIRM-LEVEL LINK BETWEEN PRODUCTIVITY DISPERSION AND WAGE INEQUALITY: A SYMPTOM OF LOW JOB MOBILITY? (with Chiara Criscuolo, Alexander Hijzen, Michael Koelle, Cyrille Schwellnus, Erling Barth, Wen-Hao Chen, Richard Fabling, Priscilla Fialho, Alfred Garloff, Katharzyna Grabska, Ryo Kambayashi, Valerie Lankester, Balazs Stadler, Oskar Nordström Skans, Satu Nurmi, Richard Upward and Wouter Zwysen)

Differences in average wages across firms – which account for around one-half of overall wage inequality – are mainly explained by differences in firm wage premia (the part of wages that depends exclusively on characteristics of firms) rather than workforce composition. Using a new cross-country dataset of linked employer-employee data, this paper investigates the role of cross-firm dispersion in productivity in explaining dispersion in firm wage premia, as well as the factors shaping the link between productivity and wages at the firm level. The results suggest that around 15% of cross-firm differences in productivity are passed on to differences in firm wage premia. The degree of pass-through is systematically larger in countries and industries with more limited job mobility, where low-productivity firms can afford to pay lower wage premia relative to high-productivity ones without a substantial fraction of workers quitting their jobs. Stronger product market competition raises pass-through while more centralised bargaining and higher minimum wages constrain firm-level wage setting at any given level of productivity dispersion. From a policy perspective, the results suggest that the key priority should be to promote job mobility, which would reduce wage differences between firms while easing the efficient reallocation of workers across them.

Targeting government aid during COVID-19:The issue of fixed costs (with Yannick Bormans  and Jozef Konings)

Many governments implement policies to support generally healthy firms to survive the COVID-19 crisis in a targeted way. Efficient design requires information on howmargins andprofitability change during the crisis, however, earlier research produced ambiguous resultsabout this relationship. This paper argues that the ambiguitymainly results from the fact that the two components of price-cost margins, the part needed to cover fixed costsand the excess profits, both as a fraction of operating revenue, move indifferent directions during aneconomic crisis. We build on a novel methodology (Abraham, Bormans, Konings & Roeger, 2020) whichestimates price-cost margins in the presence of fixed costs, and apply it to microdata from Belgium, Hungary and the UK. We show that, indeed,the fixed cost share is countercyclical while excess profitability isprocyclical.According to our estimates, the COVID-19crisis will lead to an increase of 16.0percentage pointsin the fixed cost ratio and a decrease of 3.8percentage points in excess profit rates.Finally, we identify sectors which are more vulnerable to inefficient exit of healthy firmsbased on three criteria: high operating revenue losses, large increases infixed cost shares and low pre-crisis profitability.

Analysis of the importance of intangible capital and knowledge for productivity measurement (with Márta Bisztray and Dzsamila Vonnák)

One leading explanation for the recent slowdown in productivity growth both globally and in the EU is that firm-level investments into intangibles and knowledge creation slowed down. Quantifying the role of these inputs into production requires both new methodologies and new data sources. In this paper, we use a number of firm-level surveys on innovation, R&D, intangible investments and ICT capital linked to balance sheet data to demonstrate how these data sources can contribute to productivity measurement.

The nature of buyer-supplier relationships: Lessons from the Central European Supplier Survey (with Gábor Békés, Miklós Koren and Álmos Telegdy) Presentation

The increasing importance of global value chains has created both scientific and policy interest in supplier-buyer relationships. Data availability is often a key constraint for such research. The few firm-to-firm datasets that exist contain little information on how relationships form and operate. This study introduces the Central European Supplier Survey, a new data source, which merges survey information with financial statements for a large sample of manufacturing firms from Hungary, Romania and Slovakia. The first part of the paper describes the data collection process and the different issues and dilemmas it brought about, while the second part highlights key features of firm connections. These results show that (i) buyer/supplier portfolios are correlated with productivity, (ii) key relationships are as often initiated by the buyer as the supplier and (iii) many of these relationships start with both product and process innovation.These patterns indicate that many key relationships are of long-term and relational.Such patterns can be of key interest for policymakers aiming at supporting firms in creating high-value relationships.

Competition with multinational firms (with Katehryn N. Russ)

Do multinational firms wield more market power than their domestic counterparts? Using Hungarian firm-level data between 1993 and 2007, we find that markups are 19 percent higher for foreign-owned firms than for domestically owned firms. Moreover, markups for domestically owned firms are significantly lower in industries where multinationals have a greater technological edge, suggesting that Ricardian differences in technology and endogenous markups constitute important dimensions for models of foreign direct investment. We innovate within a canonical Ricardian model of endogenous markups and heterogeneous firms to provide analytical distributions of market shares and markups when goods are imperfect substitutes to provide structure for our empirical analysis. Our model explains about half of the multinational markup premium identified in the empirical analysis. 

Ongoing research

Policy-related research and analysis

Firm growth and Investment in Pakistan for the World Bank (2021-22)

Innovation Country Report 2019: High growth enterprises, innovation and productivity challenges Hungary for the European Commision (2019)

TFP growth slowdown in Hungary for DG Growth of the European Commission (2017-2018), presentation

My team conducted on in-depth analysis of the causes and consequences of productivity slowdown in Hungary, including differences in within-firm growth and reallocation to inform policy advice of the European Commission.

High growth firms in Hungary (2017-2018)

A detailed country report on High Growth firms in Hungary prepared for the World Banks flagship report on HGFs.

Consulting for the OECD on its Innovation Review of Kazakhstan (2016-2017)

I have been one of the external experts in the preparation of the Innovation Review for Kazakhstan.

Blog posts

Research grants

H2020 MICRODROD (2019-2023)

The main aim of the MICROPROD  will be to investigate the reasons for the productivity slowdown observable in developed countries in the recent period both in terms of theory and measurement. The team, which consists of CERS HAS as well as Aarhus, Bocconi, Bruegel, CERS HAS, Paris School of Economics, Vrjie University, will set out to evaluate if productivity is measured correctly and if its underlying mechanisms are sufficiently well understood. We will also aim to study the effect of globalization and technological change on new production methods, and if the current policy environment is conducive to the new productivity environment. According to plan, I will lead the Hungarian team and the workpackage on Globalization.

Employment of the low-skilled in Hungary NKFIH Grant (2017-2020)

The falling relative wage and declining employment of low-skilled workers has led to an important debate about the role of different factors in this trend. In the last decade three potential key explanations have emerged: skill-biased technological change (Acemolglu, 2002), globalization and outsourcing (Feenstra and Hanson, 2001; Acemoglu and Autor, 2011; David et al. 2013) and changes in economic policy (e. g. declining minimum wages; Dinardo et al. 1999). The goal of this research is to provide new evidence on a number of key demand factors affecting low-skilled employment and wages. It examines both the role of economic factors such as globalization and innovation as well as the role of some prominent public policies such as trade liberalization, minimum wages and public work programs.

Firms, Strategy and Performance Momentum Grant (2013-2018)

The Momentum ("Lendület") grant of the Hungarian Academy of Sciences is for establishing new research groups to conduct outstanding research. Its design is based on that of the ERC both in terms of its evaluation method and size. I have won this research grant in 2013 to set up the research group aimed at analyzing microdata on firms. After the 5-year period, we received an evaluation with an "excellent" degree, and the Academy decided that the group will become permanent. 

Political determinants of Enterprise subsidies Global Development Network grant (2012-2014)

This grant was for studying how the affiliation of local politicians is related to the amount of grants they receive from the EU structural funds. This research was published as 'Political incentives and state subsidy allocation: Evidence from Hungarian municipalities' in the European Economic Review. 


University of Liverpool Management School, Theory of the firm & International Economic Relations, undergraduate, 2019

Currently I am teaching these undergraduate courses at ULMS.

Rajk László College for Advanced Studies, Microecomics, Economics of Innovation, Applied Econometrics, Graduate, 2008-2019

I have been teaching in this college since 2006. Rajk László College provides advanced extra-curricular courses for a special group of students who live together in a democratic community. Throughout the years, I have taught different courses there, including a one-year course in Applied Econometrics in recent years, mainly for MA students. Teaching in the small-group environment of the College is very challenging and motivating. Fortunately, many students apply for my course and the feedback tends to be quite positive. In earlier years, I also taught Microeconomics and Economics of Innovation. I have also been a resident fellow of the College between 2006-2008, becoming even more closely involved in all the issues of this institution. 

ELTE University, Organizational Economics, Undergraduate, 2009-2012

ELTE has started its innovative Economics BA program in 2008, and I joined as an external lecturer for 3 years. I have been responsible for developing and teaching a core course on the Economics of the firm (Organizational Economics), focusing on applied micro and asymmetric information. 

Magyar Nemzeti Bank (Central Bank of Hungary), Applied Econometrics, on-the-job training, 2011

Central European University, Econometrics, Graduate, 2009

Data I work with

Linked Hungarian  microdata

Linked Hungarian microdata is available on site in the research room operated together by CERS and the Central Statistical Office of Hungary. I have worked extensively with firm balance sheets, trade data, the Structure of Earnings employee-level data and the Community Innovation Survey. Some of these data has been acquired and cleaned extensively by my research group, funded from the different research grants. For example, the recent paper 'Skill-biased innovation activities' builds on linked innovation-balance sheet-Structure of Earnings data to show how different types of innovation are related to the college premium. 

Administrative firm-to-firm data

Recently, we had to opportunity to extend these linked microdata with firm-to-firm transaction data, which is collected as part of the VAT declarations of firms. Now we are working mainly on clearing these data, and comparing it to other datasources. Such firm-to-firm data is available in few countries, and enables one to investigate such questions as how the set of suppliers or buyers is related to a firm's performance, what happens to firms which start to supply multinationals within the country, or how shocks propagate via this network.


The EFIGE survey was created within the Framework 7 project "European Firms in the Global Economy", in which our institute participated. The database, for the first time in Europe, combines measures of firms’ international activities (e.g. exports, outsourcing, FDI, import) with quantitative and qualitative information on around 150 items including R&D and innovation, labour organisation, financing and organisational activities and pricing behaviour. The data consists of a representative sample (at the country level for the manufacturing industry) of almost 15,000 surveyed firms (above 10 employees) in seven European economies (Germany, France, Italy, Spain, United Kingdom, Austria, and Hungary). The data was collected in 2010, thus covering the years from 2007 to 2009. Importantly, it can be linked to AMADEUS for firm-level financial information. Many of my recent publications use these data. For example, in "The ladder of internationalization modes" we use the rich data on EFIGE to investigate how a rich set of internationalization activities (as identified from EFIGE) are linked to productivity (as identified from the AMADEUS). 

CEE Supplier Survey

Together with Gábor Békés, Miklós Koren and Álmos Telegdy and the GfK market research firm, we conducted a survey on buyer-supplier relationships of 1,800 firms in Hungary, Slovakia and Romania. The survey asked a number of questions both about the firm and their buyers and suppliers. Importantly the respondents can be linked to balance sheet data, while we are currently working on linking their partners to AMADEUS. Some preliminary patterns can be seen here.

Who supplies whom

This is a global database on automotive supply chains. It includes detailed information on the supplier of each part built into a car, produced in a specific plant. These data enables one to investigate how such relationships form, how supplier choice is related to the knowledge content or the specificity of each of the part or how input quality is related to output quality. Together with Gábor Békés, we have worked on linking these data to data on car manufacturers (to see firm performance), on car models (to measure the quality of the car), and on the type of car parts (to use patent data to measure knowledge content and technological relatedness).