Vol. 39 No. 2 (2019): Apr-Jun / 2019

Vol. 39 No. 2 (2019)

Apr-Jun / 2019
Published April 1, 2019


From classical developmentalism and post-Keynesian macroeconomics to new developmentalism
Luiz Carlos Bresser-Pereira
Brazilian Journal of Political Economy

New developmentalism was a response to the inability of classical developmentalism and post-Keynesian macroeconomics in leading middle-income countries to resume growth. New developmentalism was born in the 2000s to explain why Latin American countries stopped growing in the 1980s, while East Asian countries continued to catch up. This paper compares new developmentalism with classical developmentalism, which didn’t have a macroeconomics, and with post-Keynesian economics, whose macroeconomics is not devoted to developing countries. And shows that to follow the East Asian example is not enough industrial policy, it is also necessary a macroeconomic policy that sets the five macroeconomic prices right, rejects the growth with foreign savings policy, and keeps the macroeconomic accounts balanced.

JEL Classification: O10; O11; B29.

Geopolitics and Development in Petty, Hamilton and List
Raphael Padula, José Luís Fiori
Brazilian Journal of Political Economy

This paper argues that the views of Petty, Hamilton, and List, considered the "external threat" matter of countries a fundamental dimension of their economic development, and therefore thought national economies not only in terms of economic progress, but also as an instrument for political independence, military sovereignty and national security. Thus, the "external threat" is used to prioritize strategic objectives and direct the productive structure and the generation of income to certain sectors considered more relevant. Finally, it is argued that this conception is absent in Latin American thought and originates the discipline of International Political Economy.  

JEL Classification: F59; F52; B12.

An alert on the recent fall of the fiscal reaction in Brazil
Eduardo Lima Campos, Rubens Penha Cysne
Brazilian Journal of Political Economy

Recent evaluations of how the Brazilian government’s primary surplus reacts to the evolution of the debt to GDP ratio convey two important (and worrisome) messages: first, the reaction function has been almost steadily decreasing since 2012. Second, it has turned from positive to negative figures as of October 2017. With effective real interest rates (over the net government debt) higher than prospects of GDP growth, negative figures for the fiscal reaction function mean a non-sustainable debt trajectory. Therefore, significant fiscal adjustments are required in the short run.

JEL Classification: H30; H60; E50.

Non-linearity between exchange and prices in Brazil and implications for an economic development strategy
Mateus Ramalho Ribeiro da Fonseca, Eliane Cristina de Araújo, Elisangela Araújo
Brazilian Journal of Political Economy

The objective of this article is to perform an analysis of monetary policy in Brazil, using a Markov Chain Autoregressive Vector (MS-VAR) model, in the search for evidence of non-linearity in the relationship between exchange and prices in Brazil. The analysis showed that in periods of exchange appreciation, both on the demand side and the supply side, there is a set of forces that determine a downward trajectory for price levels, suggesting that the exchange rate plays a fundamental role in the control of inflation. However, there is a need to reassess the role of the exchange rate in Brazil.

JEL Classification: E44; E52; O23.

How QUALIS CAPES influences Brazilian academic production? A stimulus or a barrier for advancement?
Gustavo Andrey Almeida Lopes Fernandes, Leonardo de Oliveira Manchini
Brazilian Journal of Political Economy

This study delves into the consequences of QUALIS CAPES. To do that, data on the editorial boards of the journals classified as A1 and A2 in the areas of Business, Accounting and Tourism; and Economics are collected. Findings show that the US and the UK dominate the academic production. Brazil and other emerging countries are not relevant. Issues of the five top journals of each area were analyzed, showing that QUALIS may bias research in the country to issues not connected to Brazilian questions.

JEL Classification: O3; O38.

The Brazilian constitutional paradox: social rights cum regressive taxation
Pedro Fandiño, Celia Lessa Kerstenetzky
Brazilian Journal of Political Economy

This essay reviews the Brazilian Constitutional paradox, the combination of expansion of social rights cum regressive taxation, by tracing it back to the Constitution-making process. This process shows the regressive feature of the Brazilian tax system, which originates in the so-called 1988 Citizen Constitution, not to derive from the absence of a thorough, technically consistent, proposal of progressive taxation. This reinforces the cogency of the political hypothesis: “social expenditure, no problem, provided the taxation is not progressive”.

JEL Classification: P16; H29.

Historical errors in the initial conception of the euro and its subsequent development
David Ramiro Troitiño , Karoline Faerber
Brazilian Journal of Political Economy

In 1992, the European Council launched the economic and monetary union (EMU). The inception of the euro followed in 1999. Ever since, the EMU has experienced severe malfunctions, not least during the recent Eurozone crisis of 2010. To understand the current Eurozone (EZ) conundrum, it is necessary to analyse the circumstances under which the EMU was designed. Throughout its development, former French President François Mitterrand proved to be a central figure due to his ability to influence the European integration process. Against the back of German reunification, Mitterrand succeeded in obtaining the creation of an EMU from Germany. However, he thereafter failed to prevent the same union from being shaped according to the German model. This contribution argues that Mitterrand’s inability to form the EMU according to his own ideals partly explains the structural failures of the EZ.

JEL Classification: F5.

Growth and distribution endogenously determined: a theoretical model and empirical evidence
Hernán Borrero, Nestor Garza
Brazilian Journal of Political Economy

We build upon an already known but scarcely developed feature of growth theory: the importance of asset distribution in an aggregate production function. We elaborate on a simple model of two individuals, and then generalize its deductions to an extended model of n agents, concluding that perfectly distributed productive capital leads to positive and optimum long-run “endogenous” growth. Recent and classical empirical literature on the topic suggests this interpretation. In addition, we find exploratory panel data evidence that supports our theory of growth and distribution in a set of Latin-American countries.

JEL Classification: O10; O41; O54.

PT’s managerial shock? Rethinking the PT’s relationship with managerial reform
Leandro Heitich Fontoura
Brazilian Journal of Political Economy

PT leaders using the slogan “managerial shock” and defending public policies such as performance evaluation, bonus for results and transfer of services to social organizations are not found easily, once this concepts and policies are linked to PSDB, its principal political adversary. This article shows PT mayors that make a review of PT's antireform speech. The article presents data from a search, which identified PT mayors lined up to managerial principles. To evaluate the accession of PT’s local governments to Managerial Public Administration, this search evaluated Managerial Public Administration policies implementation. The search considers five principles of Managerial Public Administration: Planning; Meritocracy; Management Contracts and partnerships; Participation and citizenship; Efficiency and modernization. These principles include 20 policies, and these policies are part of the questionnaire used to interview 10 mayors and staff members of five PT local governments. It was found that, in contact with urban problems, public bureaucracy barriers and increasing of social demands, PT mayors are implementing policies to modernize the management and make it more efficient and effective to citizen. The novelty brought by this article is a review of PT's antireform speech. This posture change is characterized by constraints, tensions and conflicts with party groups and public servants. But it has signs pointing out to the construction of a new view on Managerial Public Administration by PT.

JEL Classification: J18; H11; H83.