Vol. 43 No. 1 (2023): Jan-Mar / 2023

Vol. 43 No. 1 (2023)

Jan-Mar / 2023
Published February 28, 2023


Industrial policy, techno-nationalism and Industry 4.0: China-USA technology war
Antonio Carlos Diegues, José Eduardo Roselino
Brazilian Journal of Political Economy

This paper aims to analyze the evolution of the technology war between
China and the USA in a context of exacerbation of techno-nationalist strategies for
industrial and technological development. This analysis refers mainly to the Chinese
strategy to deploy Industry 4.0 and the implications derived from US imposed restrictions
on Chinese efforts to develop indigenous technologies that are central in the forthcoming
paradigm. The hypothesis is that such policies, by boosting Industry 4.0, aim to create a
new techno-economic paradigm and thus reconfigure the bases of inter-capitalist and interstate competition. The main contribution to the literature is providing an analysis of
the implications of the technology war between China and the USA in different layers of the
Industry 4.0 techno-economic paradigm, in addition to the mainstream debate about the
transition to 5G communication networks.

JEL Classification: O53; O14; O25; O33; O38; L52.

Revisiting the concept of Economic Development and the School of Thought of Developmentalism in Economics
Isaías Albertin de Moraes
Brazilian Journal of Political Economy

This paper aims to revisit and systematize the concepts of Economic
Development and Developmentalism. The hypothesis raised by the research is
that due to the historical-social procedurality of Economic Sciences, the terms
Economic Development and Developmentalism can be categorized differently by
epistemological and didactic option nowadays. The article opted to perform a
bibliographic study. The methodological procedures for selecting the references
were bibliographic research focused on the authors with historical, concrete and inductive analysis of the economy and the phenomenon of economic
development. The results obtained are that the terms Economic Development and
Developmentalism can be categorized differently, one as a concept used by several
schools of economic thought; other as a School of Economic Thought, which has
four theoretical currents (Classical Developmentalism, Social Developmentalism,
New Developmentalism, Socialist Market Developmentalism).

JEL Classification: B20; O10; N01.

Keynes and Hayek: some common elements in business cycle theory
Alexandru Patruti
Brazilian Journal of Political Economy

Keynes and Hayek are usually perceived in the history of economic thought as
intellectual rivals. Although it is true that in terms of policy recommendations, they have
not always seen eye to eye, there are numerous theoretical elements that the two economists
tend to share. This is especially true if one follows Axel Leijonhufvud (1976) in considering
that Keynes’s fundamental theoretical work is the Treatise and not the General Theory. In the early 1930s, following the works of Wicksell (1989), both explained business cycles
as caused by a discrepancy between savings and investment. They considered that in the
modern economy the interest rate cannot speedily adjust these two magnitudes. To a certain
extent, Keynes and Hayek even agreed on the dynamic sequence of prices in a “normal”
depression. By the time the General Theory came out, liquidity preference obscured most
of the commonalities between the two economists. Although Hayek introduced liquidity
preference as a short run friction in his 1941 Pure Theory of Capital, he could not accept
it as a fundamental determinant of the interest rate. However, in the 1970s Hayek began to
believe that “normal” Hayekian crises could further degenerate into Keynesian depressions.
By focusing on Keynes’s theoretical development prior to the elaboration of the General
Theory in parallel with Hayek’s evolution throughout his life, we argue that a selective
reading of their works could lead to a theoretical model in which Keynesian and Hayekian
scenarios are specific cases of a more general theory.

JEL Classification: B13; B22; E12; E20; E32; E43.

A Classical-Post Keynesian critique on neoclassical environmentally-adjusted multifactor productivity
Giulio Guarini
Brazilian Journal of Political Economy

The aim of the article is to critically analyze Environmentally-Adjusted
Multifactor Productivity (EAMP), by considering the Classical-Post-keynesian environmental
framework Ecological Macroeconomics, integrated with the Evolutionary Environmental
Economics. The paper introduces EAMP as rooted in in neoclassical economics and derived
from Cobb-Douglas function with natural resources built by Solow (1974). I present
theoretical critiques of EAMP’s neoclassical assumptions by developing perspectives from
heterodox Ecological Macroconomics literature. Finally, I discuss the shortcomings of
EAMP’s conceptual framework, making specific reference to the policy debate on Porter
Hypothesis. The article puts in evidence how the assumptions of constant returns to scale,
perfect competition and perfect input substitutability seriously alter the meaning and
promise of sustainability policy. The analysis indicates that EAMP is a poor instrument to study complex issues regarding the promotion and effectiveness of green innovations
and should therefore be abandoned to face the great challenges regarding the process of
ecological transformation.

JEL Classification: B12; Q55; O13.

The recurring debate about the end of labor with technological unemployment
Maria de Lourdes Rollemberg Mollo, Rafael Acypreste
Brazilian Journal of Political Economy

The article analyses a recurrent question about the loss of centrality of labor
with technological innovations and immaterial labor, both from a theoretical and empirical
point of view. Theoretically, the centrality of labor is discussed both in relation to the theory
of labor value as a form of social domination in capitalism, and in relation to the limits of
technological unemployment in this mode of production. Empirically, the article presents
world and Brazilian economic data on the main causes of unemployment, comparing them
with technological unemployment.

JEL Classification: B51; J23; Z13.

The Brazilian ‘secular stagnation’: Its causes and an agenda to overcome it
Fernando Ferrari Filho, Fabio Terra
Brazilian Journal of Political Economy

The article has two goals. First, it describes and analyses the reasons for the
Brazilian ‘secular stagnation’ between 2015 and 2021. Second, it outlines an agenda to
assure the Brazilian macroeconomic stability and social development, defined as sustainable
economic growth, inflation under control, fiscal and external equilibria and income

JEL Classification: E12; E14; E52; E62; N16.

Financial budget adjustment and public debt carrying cost in Brazil 2002-2021
Gilberto Borça Jr., Nelson H. Barbosa-Filho
Brazilian Journal of Political Economy

The paper presents a decomposition of the net interest paid by the Brazilian
government, in 2002-2021, dividing the expenditure in four parts: the real-interest-rate
cost, the inflation cost, the carry cost of fixed-income assets and exchange-rate swaps.
The analysis also details the carry cost in terms of the government’s main financial assets:
(international reserves and loans to the BNDES), showing that the financial adjustment of
2016-2021 reduced the equilibrium primary balance in around 2.5% of GDP.

JEL Classification: E62; H60; N16.

Appropriation, beliefs, and inculcation: Some other connections between American Pragmatism and Veblen’s conspicuous consumer
Felipe Almeida, Manuel Ramon Luz
Brazilian Journal of Political Economy

Thorstein Veblen was a founding father of the original institutional economics.
Veblen’s first book, The Theory of the Leisure Class (1899), introduced to economists an
interdisciplinary perspective to understand consumers’ decision-making. This perspective relied on the processual nature of instincts, habits, and institutions. Veblen’s ideas on human
behavior were not completely original, and it has been widely recognized that some of
his insights clearly reference the teachings of the American pragmatic school of philosophy.
In light of this, our study offers an interpretation of Veblen’s ideas on consumer behavior
through the viewpoints of the main thinkers of the pragmatist school of his time. This study
explores some important themes within pragmatism, such as William James’s concept of
appropriation, Charles Peirce’s understanding of belief and social impulse, and John Dewey’s
ideas on socialization and the inculcation of habits. Based on these references, we seek to
generate new insights into Veblen’s perspective on consumers’ decision-making in broader
terms and at the same time preserve his main philosophical references.

JEL Classification: B15; B52.

Rousseff’s administration and the economic populism: an interpretation
Ivan Colangelo Salomão, Beliza Borba de Almeida
Brazilian Journal of Political Economy

The article analyzes the economic policy of Rousseff administration. Based on
the main economic populism theoretical models, we analyze the economic measures (fiscal,
monetary and exchange rate) adopted in that period. Thus, we refuse the hypothesis that its
government could be classified as economic populist as understood in the literature.

JEL Classification: E0; E5; H2.

Exchange rate overvaluation and agrarian ground rent transfers in Uruguay: 1955-2019
Gabriel Oyhantçabal Benelli
Brazilian Journal of Political Economy

This paper measures with a novel methodology the amount of agrarian
ground rent intersectoral transfers in Uruguay and its relative weight in the
national amount of surplus value during the period 1955-2019. In order to this,
the paper identifies the mechanisms through which ground rent is transferred from
landowners to industrial and commercial capitals. The main results show that
agrarian ground rent transfers, in particular through exchange rate overvaluation,
was a recurring mechanism that has been central for capital accumulation. These
transfers complement the surplus value appropriated by individual capitals,
however, at the same time, consolidate the rentier nature of Uruguay due to the
chronic overvaluation of exchange rate.

JEL Classification: B51; O13; O54; Q19; N16.

Ideas circulation and monetary policy in Brazil: The presence of National Monetary Council members in think tanks (1995-2018)
Mateus C. M. de Albuquerque, Pedro Rodrigues Alves
Brazilian Journal of Political Economy

This essay has for object the presence of members of the National Monetary
Council (CMN) in think tanks since 1995. The problem of research of the work is if there
is a de facto link between the CMN members and think tanks. The essay also has two
auxiliary problems: whether CMN members previously linked to their positions and then
entered think tanks or whether think tanks function as an entry mechanism for positions;
and whether members of the Council with an orthodox ideational profile tend to participate
in think tanks more than the rest.

JEL Classification: A14.

Disassembled structures: the political economy of Mexico’s leading auto export sector
James M. Cypher, Mateo Crossa
Brazilian Journal of Political Economy

Mexico’s current export-led economy arose from the adoption of a market-driven
model based in conditions of technological disarticulation separating dominant transnational
firms from the national industrial base. This determined that, in contrast to Verdoorn’s
analysis, the crucial manufacturing sector would function not as a motor-force inducing a
process of autonomous national development by accelerating productivity growth and
promoting product and process innovations, but rather would deepen a fragmented process of
production, centered on processing imported components under conditions of declining total
factor productivity. Despite the profound reordering of its economic geography over the past
30 years, this process has failed to produce legitimate markers of “upgrading”.

JEL Classification: E23; F23; F63; L62; N16.

Spending yes, progressivity no: the barriers to redistribution in Brazil
Fernanda Cimini, Laura Rocha
Brazilian Journal of Political Economy

This article investigates the trajectory of the debate on redistribution and
taxation after redemocratization in Brazil, identifying factors potentially favorable to
progressive reforms, as well as obstacles to their implementation. Specifically, it aims to
understand the resilience of an unfair tax system in one of the most unequal democracies
in the world. Following a literature review, some exploratory hypotheses are proposed and
analyzed in a preliminary and indirect way through the identification of elements related
to inequality and taxation in the political platforms of Brazilian Presidents, from Collor to

JEL Classification: H2; O15; P00.

The role of the State on foreign direct investment regulation in China
Paula Carvalho, Isabela Nogueira
Brazilian Journal of Political Economy

This article intends to corroborate the argument advocated by heterodox
economists such as Akyüz, Chang and Furtado that state regulation is crucial to extracting
the possible benefits of foreign direct investment (FDI). We do so by analyzing the policies
used by China since its opening to this type of investment in 1979. The article innovates by
scrutinizing China’s major FDI laws, regulations and guidelines that compose the formal
framework under which foreign-owned enterprises have operated in the country for almost
40 years. We then address the traditional view that China developed simply because it
increasingly opened its market to foreign investment and adopted a foreign investment-led
growth model. We argue that it was because of this strong regulation that FDI had such
a positive effect, contributing to technological transfer and trade expansion, although not
defining the ratio of capital accumulation.

JEL Classification: O16.

The effects of infrastructure and public investment on the elasticity of private investment: an empirical investigation for Brazil
Jefferson S. Fraga, Helder Lara Ferreira-Filho
Brazilian Journal of Political Economy

This study estimates the determinants of the elasticities of private investment and
total investment for the Brazilian economy for the period between 1960 and 2013. It uses
a Bayesian model averaging and weighted-average least-squares approach with a flexible
accelerator model of investment equation and Kalman filtering techniques. We conclude
that the aggregate infrastructure index (taken from the main component analysis) and
public investment crowd-in private investment. The results indicate that private investment
is constrained by the availability of bank credit. Furthermore, we find that infrastructure stock and public investment are two of the main determinants of the elasticities of private
investment. This demonstrates that public investment, mainly in infrastructure, is of great
importance in raising the sensitivity of private investment in the Brazilian economy.

JEL Classification: H54; O40; E20.

Import tariffs: the neutralization of the Dutch disease argument
Luiz Carlos Bresser-Pereira
Brazilian Journal of Political Economy

In economics, there is just one argument legitimising import tariffs – the infant
industry argument –, but it ceases to be valid as the required learning time ends. This note
offers a second argument: the neutralisation of the Dutch disease argument. If the country
faces this competitive disadvantage, import tariffs and export subsidies may be a way of
circumventing the problem. Many countries that industrialised were only successful because
they pragmatically neutralised the disease with import tariffs.

JEL Classification: F10; F43.