“The Future of Manufacturing in Brazil: Deindustrialization in Debate” [REVIEW]

A Review Essay

“The Future of Manufacturing in Brazil: Deindustrialization in Debate”

By Edmar Bacha and Monica Baumgarten de Bolle

Review co-authored by John Williamson and Roberto Zagha[1]

As indicated by the subtitle, this book is spurred by the revival of the debate on deindustrialization in Brazil. The fundamental question is whether one needs to worry that the failure of industrial growth is going to lead to a more general slowdown of the Brazilian economy and, conversely, whether faster industrial growth is key to accelerated overall growth. It may be useful to precede the discussion of the contents of the book by a brief outline of our attitude to development, which is pretty orthodox.

We take it for granted that developing countries can grow faster in per capita terms than the advanced ones, hence the possibility of catch-up.  The fundamental reason is that it is easier to learn what is already known—in terms of technologies, policies and institutions—than to create them from scratch.  The absorption of this knowledge takes multiple forms: imports of capital goods, FDI, investments in education, learning by doing, studies abroad, participation in international conferences, and so on.  This is not to say that no innovation occurs in developing countries: Brazil’s aviation or agro-industry, India’s pharmaceuticals, and China’s electronics provide examples.  However, the bulk of expansion relies on technologies invented elsewhere.

Catching up is not just a theoretical possibility.  It has happened and it has changed the lives of hundreds of millions of people.  Japan, Korea, Taiwan and Singapore are instances of countries whose per-capita incomes caught up with those of advanced economies in two generations (60 years).  China has grown at annual rates in excess of 10 percent for three decades, an achievement unprecedented in human history: Whereas in 1980 China’s per capita income accounted for less than 3 per cent of the US per capita income (in purchasing power parity terms), it reached 19 percent in 2010 (the last year for which per-capita data in PPP terms are available).  In the same period Korea’s per capita income grew from 21 percent of that in the US to 64 percent.  Within 20 years, China’s per capita income is expected to reach today’s average in the OECD countries. East Asian countries’ high rates of growth have been facilitated by export-oriented industrialization, massive investments in infrastructure and education, stable and highly competitive exchange rates, and high savings. Whether the extensive state intervention to promote some industries helped very much is still subject to dispute: there is also the example of Hong Kong, which developed similarly under the closest the world had ever seen to pure laissez-faire (at least until the Baltic countries achieved independence).  In contrast, at recent rates of growth Brazil will need several centuries to catch up with living standards in the West.

Brazil has experienced periods of high growth as well, which started well before East Asia’s take off.  Between the end of WWI in 1918 and 1980, GDP grew at a compound rate of 6.3 per cent, a rate comparable to East Asia’s more recent performance.  It was not a smooth process.  Over these 60 years there were periods of growth exceeding 10 percent per year, as well as periods when growth was negative or marginal.  Inflation was a recurrent problem.  There were balance of payments crises.  There were military dictatorships and returns to democracy. Over 1932-39, while the rest of the world was mired in the Great Depression, manufacturing in Brazil grew at a rate of 9 percent per year.  This was an incidental result of price support for coffee, which had the effect of bringing about expansionary fiscal and monetary policies—Keynesian policies driven by the political need to protect the incomes of the politically powerful coffee farmers.  During the 1940s and 1950s there was extensive state-driven industrialization when some of Brazil’s largest public enterprises were created, such as Companhia do Vale do Rio Doce in 1941, Companhia Siderurgica Nacional in 1942, and Petrobras in 1952.  There was an opening up of the economy in the 1960s and a return to protectionism in the 1970s  This is not the place to review the economic policies over these 60 years; it suffices to remember that the process was not linear; there were abrupt changes, corrections, but, perhaps crucially, a political will to grow.  The net result was highly positive.

Brazil’s growth came to a stop in 1980.  Had the growth continued at the rates of the previous 60 years, Brazil’s per capita income would be twice what it is today.  As it happened, GDP growth was close to zero in the 1980s, barely above the population growth rate in the 1990s, and just above 2 percent per-capita during 2000-12 (2.2 per cent per year to be exact)—still barely enough to catch up with advanced economies, where the long term per-capita growth rate is close to 2 percent.   As a result, Brazil’s per capita income as a share of the US per capita GDP has declined from 32 percent in 1980 to 20 percent at present.

Since 1980, total factor productivity growth (TFPG) was for a long time negative, as documented by several studies[2].  It picked up in the early 2000s, when growth accelerated.  One reason for the long period of low or negative TFPG is that employment grew more rapidly in lower productivity activities, mostly in the informal service sector.  One of the central insights of development economics is that economic development entails moving resources from low productivity activities to higher productivity ones.  As labor moves from agriculture into modern activities the overall productivity of the economy rises.  Even within the same sector, productivity increases when labor moves from informal to formal employment.  What happened in the post debt crisis years in Brazil is that employment grew mostly in the less productive parts of the service sector, and that the share of employment in manufacturing declined.  In 1981 agriculture accounted for 29 percent of employment, industry for 25 percent, and services for 46 percent.  In 2009 (the last year for which data are available from the WB), the corresponding figures are 17, 22 and 61 percent.  And while in recent years there has been a shift from informal to formal employment, the share of the labor force in informal employment continues to be very high.  Various estimates suggest between 33 and 50 percent[3].

The shift out of industry that prevailed in recent years differs from what we see in China, and may help explain the evolution of TFPG over the last two decades.  While the share of manufacturing in any economy declines when per-capita incomes reach higher levels, Brazil  may have  started this evolution too early—“de-industrialization”  may be premature or excessive in a country whose per-capita GDP is just 20  percent that of the US (in 2010) and far behind that of the advanced economies of East Asia.

Bacha’s and Baumgarten’s book is a timely contribution to the understanding and debate of Brazil’s surprising growth deceleration and the loss of momentum of its industrial development.  It contains pearls of analysis as well as surprising errors of omission and errors of commission.  These errors are as important as the insights because they reflect the state of mind of Brazil’s economists and policy makers In particular, one is surprised by the lack of interest on Brazil’s loss of growth momentum over 30 years, of curiosity on the reasons behind Asia’s high growth achievers, and of interest in the limited integration in the global economy in contrast with the fast growing Asian economies.   Is the premise that Brazil is so unique that there are no lessons to draw from the success of others?  Is it, as Fishlow suggests, that “God is Brazilian”?  Are the relevant comparators, as indicated in several of the papers, Australia, Canada, and Norway?  Or are they instead China, India, Vietnam, Korea, Japan?  Whatever the reason, exceptionalism is inimical to intellectual curiosity and to sound policy making.

Part I contains three chapters. The first is a revised and updated version of Albert Fishlow’s classic article describing Brazil’s import-substitution policy in the postwar years. Rich as this article is, it hardly fits with the title of the book, which one begins to think should have been called “The Past of Industrialization in Brazil”.  As in his other publications[4]  Fishlow is a constant optimist about Brazil, but one should be concerned that his optimism has been unscathed by three decades squandered in terms of economic growth.  It would have been useful to have a justification of his optimism.

The second chapter is by Regis Bonelli, Samuel Pessoâ, and Silvia Mattos. They distinguish three possible reasons why industry is decreasing: a cyclical weakness of industry on a global basis; the integration of China, India, and other Asian countries with low labor costs into the global market; and the secular tendency for the weight of manufacturing to decline, as a counterpart to the increase of services. (As brought out in one of the subsequent papers, there is a fourth possible reason, which is capable of explaining differential national tendencies: abnormally high unit labor costs—or, for that matter, other national weaknesses in the industrial sector). The main part of the paper shows just how general the decline of manufacturing as a share of GDP has been. Brazil achieved its maximum of 27% in the middle of the 1970s, since when the share has declined about 1 percentage point of GDP every 5 years. They go on to calculate a regression equation (R2 adjusted = 0.42) that explains the share of manufacturing in GDP, as a function of per capita income and its square, population, the savings rate, population density, and the real exchange rate (not significant); one wishes the output of the commodity-producing sectors as a fraction of GDP had been included too. They conclude from this that Brazil (currently 0.14 to 0.15) lies only 1% of GDP below the lower confidence interval.  The implication is that Brazil’s deindustrialization is to be expected and is consistent with fundamentals. The corollary is that Brazil is condemned to continue to be a laggard in the world economy.

The third chapter is by Luiz Schymura and Mauricio Canêdo Pinheiro, and is the first where Industrial policy is discussed. The authors give the impression of being conflicted; they want to support industrial policy, but the reasons they give for this support are highly unconvincing. They end up by supporting “light” industrial policy, in the sense of either being restricted to the general provision of public goods or involving market interventions that benefit particular firms, but opposing “heavy” industrial policy, which according to their diagram involves both general provision of public goods and is designed to favor particular firms. The logic of their position escapes us.

Part II contains 4 chapters that explore the (very) short-term decline of manufacturing in Brazil and link it to external and internal macro-economic developments and policies.  The four papers complement each other and suggest that good luck for the country was actually bad for the industrial sector. Government policies did not have industrial growth as a priority and the decline in Brazil’s industrial growth was the passive and (except for one paper) inevitable result of the vagaries of the weather, international commodity prices, and other external shocks. The four papers are possibly the best in the book—analytical and well-researched—even though they recognize Brazil’s “de-industrialization” has been going on for more years than the few analyzed in their papers.

The first chapter, by Edmar Bacha, aims to explain the decline in industrial production from 18 percent of GDP in 2005 to 16 percent of GDP in 2011.  Starting in 2005 Brazil has experienced an episode of Dutch disease: a significant increase in the price of its commodity exports and capital inflows, both leading to a real appreciation of the currency.  The paper develops an accounting framework to estimate the windfall followed by a simple macro-economic model showing that this windfall, by allowing higher levels of domestic absorption, increased the demand for non-tradables and hence a shift of labor from tradables to non-tradables.  While the model explains the decline in the share of the manufacturing sector, it does not allow “what if” questions.  What if the government had introduced export taxes to capture a part of the windfall and hence partially offset expansionary public spending?  What if it had abandoned, or toned down, its expansionary public spending? What if it had taxed or introduced controls on inflows of capital more severely than it has?  What if it had accumulated reserves at a higher rate?  Or adopted a combination of all these policies?  The paper concludes on the need to develop a more complex dynamic model to answer these questions, and one can only applaud this plan. But it will be unfortunate if the absence of the ability to pose such questions is interpreted as an endorsement of the policies that produced them.

The paper by Affonso Celso Pastore, Marcelo Gazzano and Maria Cristina Pinnoti is another solid piece of analysis which seeks to explain the stagnation of the industrial sector since 2010.  It provides a counter-intuitive finding: the decline in the share of industry in the economy has been worsened by the fiscal and monetary counter-cyclical policies pursued in response to the 2008 crisis.  The expansion in domestic demand resulted (as estimated in the previous paper) in an increase in the demand for services and hence of wages in that sector. Like the Scandinavian model of inflation, they argue that both sectors must have equal wage increases, though they assert that it is the dominant sector numerically—the service sector, which employs 60 million versus the 20 million in manufacturing—that determines wage inflation. The resulting increase in unit costs in manufacturing did not offset the positive impact of interest rate reductions. The consequence was the reduction of capacity utilization in manufacturing and an increase in imports of industrial goods.  This explains the decline in capacity utilization in the industrial sector, despite the economy being close to full employment.

The third paper in this part is the interesting and clear paper by Beny Parnes and Gabriel Hartung, which examines the rise (2004-08) and decline (2008-12) of Brazilian industrial growth.  In fact, industrial production in 2012 was 2 percent below the level of 2008.  The authors raise the question:  was the industrial deceleration the result of a global shock, or the result of Brazilian domestic policies?    The industrial deceleration in Brazil was much faster, and lasted longer, than in other parts of the world, and industrial growth lagged behind such growth elsewhere.  The authors conclude that industrial deceleration in Brazil was the result of domestic policies; these increased domestic demand in response to the 2008 shock, reduced the fiscal surplus, and helped increase real wages.   Together with the appreciation of the nominal exchange rate, this led to an increase in the dollar unit cost of labor.  In fact, this increase already started in the early 2000s (see Table 1 of the paper) when the dollar unit cost of labor started to rise faster than in any of the competitive countries of East Asia, or Europe, or the US, both as a result of the appreciation of the exchange rate, and rises in real wages at rates higher than productivity growth.   As in the preceding paper, the rise in real wages—at rates above productivity growth–is the result of expanded demand for services.

The paper by Ilan Goldfajn and Aurelio Bicalio concludes Part II of the book. They use a VAR model to study the responses of industry and services to demand shocks. They confirm that one of the reasons behind the deceleration of industrial growth since 2008 was the expansionary fiscal and monetary policies adopted in the wake of the Lehman crisis, that generated strong demand for services rather than goods, with the resulting effects on wages noted in the paper of Pastore et al.

While the four papers contain interesting and insightful perspectives, the deceleration of Brazil’s industrial sector has had a much longer history than that examined in this part of the book, and one would have expected some questions to be explored, or at least posed, such as: why was Brazil able to grow its industry in the past and is failing now?  What were the motivations of governments that pushed growth? Has it been accepted that Brazil will not be able to catch up with the current level of industrialization?  At the time of writing growth is declining as the commodity price boom fades away. What are the policy actions that could help restore industrial dynamism?

Part III of the book contains three chapters.  That by Sergio G. Lazzarini, Marcos Sawaka Jank and Carlos F. Kiyoshi V. Inoue focuses on the effects of the commodity boom on Brazil’s industrial performance, and discusses whether this boom has been a blessing or a curse.  Ignoring six decades of theory and practice of development experience, the authors’ unambiguous answer is that it has been a blessing.  They debunk five “myths”: (1) value added in commodities is low; (2) the technological content of commodities is low; (3) the rents are captured by the political system; (4) there is a secular decline in the price of commodities; and (5) commodities are a cause of Brazil’s Dutch disease.   The power of their convictions finds no parallel in the paper’s reasoning or data, however.  The two concerns with a commodity economy are not that the value added is low: on the contrary, it is well known that a commodity economy is typically based on advanced technologies and capital intensive production methods, and hence labor productivity is very high (as the chapter illustrates). The concerns are, rather, that commodities have few linkages with the rest of the economy, and that they appreciate the exchange rate and reduce the competitiveness of labor-intensive and less technologically advanced sectors. Showing commodities add value and that labor is more productive than in the rest of the economy hardly addresses these two problems.  Regarding capture, the authors may be right that income inequality is more important than production of commodities per se.  They may also be right that through creative institutional design and state ownership Norway has been able to avoid the worst consequences of a resource curse.  But can Brazil import Norway’s (5 million people) income distribution? And is it realistic to base improvements in income distribution on the distribution of commodity rents as they suggest? Turning to the secular decline of commodity prices, the authors are right on the lack of evidence—that was settled a long time ago.  The authors are also right that volatility is and remains a problem.  Last but not least, the authors’ view that the Brazilian economy is sufficiently large and diversified to withstand Dutch disease relies is belied by the facts.   At $2.2 trillion (at market exchange rates) the economy of Brazil accounts for one fourth that of China, one-sixth that of the US, and 3 percent of the global economy.  The economic opportunities afforded by an economy more integrated in the rest of the world, in terms of export opportunities and economies of scale, vastly surpass those that can be achieved in an economy 3 percent the world size.

The second chapter, by Sandra Polonia Rios and Jose Tavares de Araujo Jr, starts on an optimistic note: it points out that Brazil’s manufacturing exports in 2011 were close to the 2008 historical record; industrial production in 2011 was 33 percent above its 1996 level; and that the share of exported manufacturing output increased from 9 percent in 1996 to 19 percent in 2005.  It then shows that sectors which grew the fastest are those where imports as a share of domestic production are the highest.  Fierce competition forced firms to respond through improved competitiveness: they adopted innovations generated abroad and expanded investments in R&D.  However, a 33 percent increase in manufacturing output from 1996 to 2011 amounts only to a 2 percent annual growth rate. Most sectors have lost export competitiveness. The performance of labor-intensive sectors has been particularly dismal, because of the emergence of low-wage China and other Asian economies.  The conclusion, rather exhortation, is that Brazilian manufacturing needs to increase its productivity—but the mechanism and dynamics of the process are left unspecified.

The last chapter in this part is a valuable contribution to the main theme of the book.  It shows that Brazil has been unable to participate in the growth of international trade, including the part based on value chains, mainly because of the country’s high tariffs.  Whereas in 2011 Brazil ranked 6th in terms of the size of its economy, it ranked 22nd by volume of exports.  Among some of the largest developing countries, Brazil has the highest tariffs on imports of capital goods, twice as high as China or Korea, and 60 percent higher than India’s.  In the case of intermediate goods, while the differential is less pronounced, Brazil has the highest rates among relevant comparators.  This is perhaps the best documented paper of this part of the book and the most useful in terms of its implications and conclusions.

The fourth part of the book consists of three chapters dealing with different aspects of industrial policy.  The first, by Mansueto de Almeida, reviews the recent literature on industrial policy, and makes the useful point that a large share of official (subsidized) lending by the National Development Bank (BNDES) has been dedicated to sectors which were already well established—thus not contributing to a more diversified industry.  The second paper, by Vinicios Carrasco and Joao Manuel Pinho de Mello, demonstrates the (well-known) fact that protection of an industrial sector is an implicit tax on consumers, but then goes on to the very useful and insightful exercise of documenting the effects of protection on one industrial product widely used in the construction industry: the steel reinforced bar (“rebars”).  It shows that a regulation (presumably) prevents imports of rebars below a certain grade, which is higher than that commonly used in European countries, the US, or China.  The result is that the price of rebars in Brazil is between 2 and 4 times that in other countries.  How seemingly benign (presumably safety) regulations end up providing what turns up to be huge protection to the domestic industry is a very important insight.  One would have liked to know more detail, and if it extends to other manufactured goods.  One suspects that high tariffs, and regulations of the type that apply to steel rebars, explain why imports in Brazil are so low in relation to its GDP.  The third paper of this part of the book, by Tiago Berriel, Marco Bonomo, and Carlos Viana de Carvalho, is an unusual exercise seeking to estimate the optimal composition (agriculture, industry and services) of the Brazilian economy, recognizing that an economy highly concentrated in the sectors in which it has the greatest comparative advantage runs the risk of low diversification and high variability of incomes.  It applies an analytical framework that establishes a trade-off between diversification and economic growth that concludes that the share of industry in Brazilian GDP is above optimal.  This is an interesting mental exercise, but it would be a mistake to take its result to heart.

The fifth and last part of the book consists of four chapters that explore different aspects of the Brazilian policies implemented in recent years.  The paper by Eduardo Augusto Guimaraes examines the effects of minimum local content requirements in industries supplying equipment and materials to Petrobras for oil and gas exploration.  It concludes that the local content requirements are excessive and lacking in a sense of priorities.  In particular, the policy should clearly identify the parts of the industry that have a long term potential and focus on those.

The well-researched paper by Leonardo Rezende analyzes the current system of government support to industrial innovation.  It contains two interesting conclusions.  The current system does not support industries that innovate and, in fact, supports mostly incumbents in the highly concentrated parts of the industrial sector (reinforcing the conclusion of Carrasco and Pinho de Mello).  The author recommends a reorientation of government support towards innovation in areas that would benefit a large number of firms—on the example of EMBRAPA (a large and highly successful agricultural research outfit responsible for much Brazilian progress in agriculture in the last three decades).

The last two papers of the book contain two different perspectives on the government’s recent decision to change the basis of social security taxes from wages to revenue of the firm.  The paper by Rogerio Werneck considers this change a mistake: social security benefits should be financed by those who benefit from them.  In addition, the change introduces cascading into the tax system.  The paper by Fernanda Guardado and Monica Baumgarten recognizes these shortcomings, but also highlights the fact that the change introduces a welcome counter cyclical component to the tax system.  They also make the point that this change has a long run effect, because it encourages the substitution of labor for capital  – and since they consider Brazil to be close to full employment, it is the use of capital that they argue should be encouraged in the long run.   Given the large share of informality in Brazil, the conclusion that one should encourage the substitution of capital for labor seems hasty.

So much for detailed review of the individual chapters which, in many cases, give the impression of complacency: Brazil had the great good fortune to enjoy improved terms of trade and abundant capital inflows that enabled it to run down its manufacturing industry without encountering a balance of payments problem. Presumably the impending reversal of this good fortune, if it occurs, will be regarded as a problem, but a separate problem. Commodities are a blessing rather than a curse. Industry is only one percentage point of GDP below the lower confidence interval in the analysis of Bonelli et al, while the paper of Terriel et al even concludes that it is too large. China, India, and other Asian countries are low wage economies against which Brazil cannot compete.  The size of Brazil’s economy can provide markets sufficiently large to support industrial development. And while one can only agree that Brazil’s industry needs to be internationally competitive, a theme in several of the chapters, the dynamics of this process are left unclear.  Why would firms invest to expand and modernize when some of the fundamentals of the economy are so unsupportive and uncertain?  The drama of growth lost for an entire generation does not seem to find a sufficiently large voice in the book; one would have liked a little more stridency on this issue.  For the millions of people in Brazil who are not fortunate enough to belong to the distinguished groups analyzing the economy and formulating policies, the decline of per capita income as a share of US per capita GDP from 32 percent in 1980 to 20 percent at present is nothing less than a silent tragedy of missed opportunities and squandered lives.

One can therefore understand that, in August 2013, as reported in the newspaper Valor[5], Edmar Bacha had a nightmare the night preceding a trip to Sāo Paulo to present and discuss the book with a group of prominent industrialists.  In the nightmare, the building hosting the Federation of Sāo Paulo Industrialists (FIESP) had become an industrial museum.  In a sudden reversal of fortunes, however, the building was restored as the Federation of Manufacturing Exporters of Sāo Paulo, the message being that to grow faster Brazil needs to orient its industry towards exports.

A few weeks later, Bacha published a paper[6] which, reinforcing the conclusions of the paper in this book, recognizes that the euphoria of 2004-12 was unsustainable and due to a bout of good luck, a windfall which is now over, and that “the Brazilian economy is sick”.   According to the paper, the closedness of the economy is responsible for this state of affairs.  Both in terms of exports and imports relative to the size of the economy, Brazil lags well behind other economies.  The solution is to adopt policies that would integrate the country more closely in the global economy and be a larger participant in world trade (Brazil’s share of world exports declined from 2 percent in the 1950s to half that at present).    A clear message is that—as was the case during the years of the “miracle” — Brazil needs to expand the role of exports in its economy and growth strategy.  Higher exports would tend to result in a larger industrial sector, though how much larger is not something on which we would be dogmatic. (The one thing that is clear on the latter is that it was a mistake to allow the industrial sector to be squeezed by temporary booms in commodities and capital imports.)

To implement a growth-oriented strategy, Bacha suggests three types of reforms, to be introduced gradually: fiscal, reduction of import protection, and preferential trade agreements.  The fiscal proposal is to emulate a policy introduced in Israel that constrains expenditure growth to one-half of the GDP growth of the previous ten years.  The second pillar would consist of a reduction of import tariffs over several years, together with elimination of all the preferences granted domestic industry (in the form of local content requirements, preferences in government procurement, and technical specifications different from those accepted internationally), compensated by devaluation.   In an Annex to the paper, the author provides more details on how to maintain the competitiveness of the real exchange rate, including through restrictions on capital inflows.  This is a refreshingly novel recognition of the role of the exchange rate in an export-oriented growth strategy and of the costs of an open capital account.  There has been ample recognition[7] on the need to manage financial flows in a manner that does not damage the real economy and does not appreciate the exchange rate unduly.  These lessons from recent decades of the development experience have been well assimilated in East Asia.  In Brazil, however, there has been a Churchillian aspiration to a strong currency with little awareness or even discussion of its costs.  The greatest contribution of “The Future of Industrialization in Brazil” may have been to prepare the ground for a paper that recognizes that Brazil needs an export-oriented growth strategy and that this strategy is closely related to a more open import regime and a more competitive exchange rate.

[1] John Williamson was a senior fellow associated with the Petersen Institute from 1981 to 2012; Roberto Zagha has recently retired from the World Bank and wrote this paper while a visiting fellow at the Hoover Institute, Stanford University, which he thanks for the support afforded to complete this work.  The Portuguese version of this paper has been submitted to the Journal “Estudos Economicos”

[2] Bacha, Edmar and Regis Bonelli, “Crescimento Brasileiro Revisitado” in “Desenvolvimento Economico: Uma Perspectiva Brasileira”, volume edited by Veloso, Fernando; and Ferreira, Pedro Cavalcanti; Pessoâ–Elsevier, 2013; Bosworth, Barry and Susan M. Collins (2003). “The Empirics of Growth: An Update.”  Brookings Papers on Economic Activity (2).  McMillan, Margaret S. and Dani Rodrik, “Globalization, Structural Change and Productivity Growth” NBER Working Paper 17143 June 2011

[3] Holanda Barbosa Filho, Fernando, e Veloso, Fernando: “A Contribuição da Formalização para a Elevação Recente da Produtividade do Trabalho no Brasil”  IBRE/FGV, 2013

[4] Fishlow, Albert “Starting Over: Brazil Since 1985” Brookings Institution Press, Washington DC 2011;  “O novo Brasil: as conquistas políticas, econômicas, sociais e nas relações internacionais”,  Saint Paul Editora, Sao Paulo; “Down But Not Out.” Foreign Policy May 18, 2012.

[5] Valor Economico of August 27, 2013, “O sonho de Bacha”

[6] Bacha, Edmar (2013): Integrar Para Crescer: O Brasil na Economia mundial.  Paper presented at the National Forum Brasil,  Estratégia de Desenvolvimento Industrial com Maior Inserção Internacional e Fortalecimento da Competitividade. Rio de Janeiro: BNDES.

[7]  Jeanne, Olivier, Subramanian, Arvind, and Williamson, John (2012), Who Needs to Open the Capital Account? Petersen Institute for International Economics; Rodrik, Dani (1998) Who Needs Capital Account Convertibility?” in Essays in International Finance, Princeton University, May 1998;   Rogoff, Ken (1999), International Institutions for Reducing Global Financial Instability,” Journal of Economic Perspectives, Vol. 13 (Fall), pp. 21-42and “Rethinking capital controls: When should we keep an open mind?”, Finance and Development, December 2002, Volume 39, Number 4; Williamson, John (1995), The Management of Capital Inflows, in Pensamiento Iberoamericacon, January-June 1995.

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