Mateus Morais

This paper studies how consumption opportunities vary within a city and how these differences shape urban inequality and residential sorting. Using novel barcode-level price data from all formal retailers in Maceió, Brazil, I document large within-city disparities in prices, varieties, and product quality. Higher-income neighbourhoods offer greater variety and quality at systematically higher prices. To interpret these patterns, I develop a quantitative spatial model in which households value varieties and quality differently by income, and firms choose both locations and product assortments. In this environment, neighbourhood composition affects the market size for a given variety, creating consumption externalities: households benefit from living near others with similar preferences because it expands the set of varieties they can access. The model clarifies how these endogenous differences in product availability and pricing generate an amenity that attracts richer households and amplifies spatial inequality. A counterfactual that eliminates local shopping frictions substantially reduces income-gradient sorting, quantifying how endogenous retail supply amplifies spatial inequality through the consumption channel.

with Gustavo Gonzaga, Henrique Mota, and Rafael Cayres

We study the consequences of abolishing mandatory homologation in Brazil's 2017 Labor Reform. Homologation was a dismissal-triggered audit required for workers with at least twelve months of tenure and served as the primary enforcement channel for employer deposits into the FGTS, a mandatory severance savings account. Using matched employer–employee administrative data and a differences-in-differences design that compares workers at 11 versus 12 months of tenure before and after the reform, we find that unjustified dismissal rates at 11 months fell by 0.524 percentage points — about 16% of the pre-reform level. Effects are largest in small firms, low-inspection sectors, and among less-educated workers, consistent with non-compliance being more prevalent where oversight is weakest. We then estimate a search-and-matching model with learning and endogenous compliance, disciplined by the full tenure-hazard profile. Estimated on pre-reform data only, the model predicts that the month-11 spike disappears after homologation is removed — an out-of-sample prediction confirmed by the data. The model implies that routine inspections alone are insufficient to sustain compliance, so the reform increases evasion. Although job stability improves, within the model per-worker welfare falls by 0.92 monthly wages because the loss of enforced savings contributions outweighs the reduction in anticipatory dismissals. Overall, enforcement design matters as much as statutory firing costs.