Strategic options development and analysis: the case of the brazilian railways

Judging by their success in Europe, Asia and North America, passenger and cargo railways are appreciated as the key to infrastructural development in Brazil. The issues are complex and steeped in uncertainty, as well as political and economic agendas, and a wide array of intersecting issues such as business and unionized interests, agricultural and industrial geographical spreads, as well as the emergence of alternative power sources. Not only are the issues systemic, but railway development itself always comes as a physical network structure. The situation under consideration, in other words, is systemic from both the soft and hard systems point of view, thus promising a rich context for systems studies. As an initial attempt in understanding the situation at hand, the research reported here applied the problem structuring approach known as Strategic Options Development and Analysis (SODA) in order to map and analyze issues facing the Brazilian railways. Strategic options for the future development of the railways were identified and analyzed, and ways forward for future research are proposed. In addition, the report serves as an initial knowledge base that can guide future systemic planning studies in the industry.

The Brazilian venture capital industry and its strategic role in closing the financing gap of SMEs

This discussion paper is a contribution of the Brazilian Government to the 2006 Annual Conference of the OECD High-level Conference on "Better Financing for Entrepreneurship and SMEs" to be held in Brasilia, Brazil on 27-30 March 2006. It has been prepared by The Center for Studies in Private Equity and Venture Capital of EAESP-Fundação Getúlio Vargas under the auspices of ABDI – Agência Brasileira para o Desenvolvimento Industrial – an agency of the Ministry of Industrial Development and Foreign Trade, in cooperation with ABVCAP – The Brazilian Association of Private Equity and Venture Capital

Fostering innovation and entrepreneurship in Brazil through private equity and venture capital public policies

It is well documented the positive impact of the Private Equity and Venture Capital (PE/VC) industry on the creation and development of highly successful innovative companies in a few countries, mainly in the United States. PE/VC firms provide not only capital to startups and small and medium enterprises (SMEs) that usually have financing gap, especially in emerging markets, but also strategic resources that enable these enterprises to commercialize innovation. As consequence, government incentive and nurture of local PE/VC industries would be expected in emerging economies due to innovation‟s importance to economic growth. This paper aims to identify if the Brazilian government has supported local PE/VC industry throughout the years in order to foster favorable conditions to creating and developing successful innovative businesses. It also analyzes Brazil‟s main public policies towards PE/VC and if they encompass all the three stages of its cycle – fundraising, investing and exiting. I conducted an empirical research which collected primary data from a sample of 127 PE/VC firms (90% of the population) operating in Brazil as of June, 2008. All firms answered a webbased questionnaire that collected quantitative data regarding their investment vehicles, portfolio companies, investments and exits. I compared the data obtained from the survey with the main local governmental PE/VC support programs. First, I confirmed the hypothesis that the Brazilian government has been using the PE/VC industry as a public policy towards entrepreneurship and innovation. Second, I identified that although PE/VC public policies in Brazil are mostly concentrated in fundraising phase, they have been able to positively impact the whole cycle. Third, it became clear that the Brazilian government became more concerned about Seed and Venture Capital (VC) Early stages due to their importance to the entire PE/VC value chain. As consequence, I conclude that those public policies have been very important to build a dynamic and strong local PE/VC industry, whose committed capital grew 50% per year between 2005 and 2008 to achieve US$27 billion, which invested US$ 11 billion, which employs 1,400 professionals (75% with postgraduate degrees) and maintains 482 portfolio companies, mostly SMEs. In addition, PE/VCbacked companies represented one third of the Initial Public Offerings (IPOs) that occurred in Brazil between 2004 and 2008 (approximately US$15 billion).

Toward convergence? The brazilian stock market concentration and the role of private equity in its diversification

Using quantitative data obtained from public available database, this paper discusses the difference between of the Brazilian GDP and the Brazilian Stock Exchange industry breakdown. I examined if, and to what extent, the industry breakdowns are similar. First, I found out that the Stock Exchange industry breakdown is overwhelming different from the GDP, which may present a potential problem to asset allocation and portfolio diversification in Brazil. Second, I identified an important evidence of a convergence between the GDP and the Stock Exchange in the last 9 years. Third, it became clear that the Privatizations in the late 90’s and IPO market from 2004 to 2008 change the dynamics of the Brazilian Stock Exchange. And fourth, I identified that Private Equity and Venture Capital industry may play an important role on the portfolio diversification in Brazil.

Unconditional transfers goes to health? Evidence from Brazilian municipalities

This study assesses the impact of unconditional transfer resources on the health indicators of Brazilian municipalities. This transfer refers to the Participation Fund of Municipalities (FPM) where at least 15% of its value should be spent on public health. Based on a discontinuity of the rules of transfers, we explore Regression Discontinuous Design for the years 2002 to 2010, and find: (i) no significant effect of FPM on mortality reduction; (ii) a robust and significant reduction in morbidity, treated municipalities – on the right side of thresholds – on average have a per capita rate of morbidity 0.00821% lower than those on the left side of the cutoff points; (iii) the mechanisms through which a reduction on morbidity could be operated would be due to estimated increases in preventive measures such as consultations and medical and nurses visits, these were bigger for the treated group in, respectively, 0.32%, 0.038% and 0.039%.

Intergovernmental transfers and public spending in Brazilian municipalities

We estimate the effects of unconditional (full fiscal decentralization) versus conditional (partial fiscal decentralization) block grants on local public spending in Brazilian municipalities. Our results suggest that the effect of unconditional and conditional transfers do not differ statistically. Their combination promotes a full crowding-in effect on aggregate public spending — i.e., for $1 of unconditional and conditional grant receipts; we find $1 of additional local public expenditures, greater than the corresponding effect of local income, providing further evidence for the flypaper effect. Moreover, the effect of unconditional transfers on education (health) spending is smaller than the effect of conditional education (health) transfers but greater than the corresponding effect of local income. We consider four strategies to identify causal effects of federal grants and the local income on fiscal responses regarding Brazilian local governments: (i) a fuzzy regression discontinuity design, (ii) Redistributive rules of education funds, (iii) Oil and Gas production, and (iv) Rainfall deviations from the historical mean.

Is what you say what you do? Analyzing and comparing the effect of buyer-supplier relationship in the Brazilian and Chinese supplier selection criteria

Choosing properly and efficiently a supplier has been challenging practitioners and academics since 1960’s. Since then, countless studies had been performed and relevant changes in the business scenario were considered such as global sourcing, quality-orientation, just-in-time practices. It is almost consensus that quality should be the selection driver, however, some polemical findings questioned this general agreement. Therefore, one of the objectives of the study was to identify the supplier selection criteria and bring this discussion back again. Moreover, Dickson (1966) suggested existing business relationship as selection criterion, then it was reviewed the importance of business relationship for the company and noted a set of potential negative effects that could rise from it. By considering these side effects of relationship, this research aimed to investigate how the relationship could influence the supplier selection and how its harmful effects could affect the selection process. The impact of this phenomenon was investigated cross-nationally. The research strategy adopted was a controlled experiment via vignette combined with discrete choice analysis. The data collections were performed in China and Brazil. By examining the results, it could be drawn five major findings. First, when purchasers were asked to declare their supplier selection priorities, quality was stated as the most important independently of country and relationship. This result was consistent with diverse studies since 60’s. However, when purchasers were exposed to a multi-criteria trade-off situation, their actual selection priorities deviate from what they had declared. In the actual decision-making without influence of buyer-supplier relationship, Brazilian purchasers focused on price and Chinese buyers prioritized delivery then price. This observation reinforced some controversial prior studies of Verma & Pullman (1998) and Hirakubo & Kublin (1998). Second, through the introduction of the buyer-supplier relationship (operationalized via relational capital) in the supplier selection process, this research extended the existing studies and found that Brazilian buyers still focused on price. The relationship became just another criterion for supplier selection such as quality and delivery. However, from the Chinese sample, the results suggested that quality was totally discarded and the decision was majorly made through price and relationship. The third finding suggested that relational capital could legitimate the quality and sustainability of the supplier and replaces these selection criteria and made the decisional task less complex. Additionally, with the relational capital, the decision-makings were associated to few biases such as availability cognition, commitment, confirmatory and perceived biases. By analyzing the purchasers’ behavior, relational capital inducted buyers of both countries to relax in their purchasing requirements (quality, delivery and sustainability) leading to potential negative effects. In the Brazilian sample, the phenomenon of willing to pay a higher price for a lower quality offer demonstrated to be a potential counterproductive and suboptimal decision. Finally, the last finding was associated to the cultural effect on the buyers’ decisions. From the outcome, it is possible to observe that if a purchaser’s cultural background is more relation-oriented, the more he will tend to use relational capital as a decision heuristic, thus, the purchaser will be more susceptible to the potential relationship’s side effects

Share bidding auctions, sliding scale royalty rates and the new brazilian regulatory framework for the pre-salt areas

O governo brasileiro recentemente aprovou uma legislação instituindo um novo marco regulatório para as reservas petrolíferas do pré-sal. Segundo as novas regras, estas áreas deverão ser licitadas mediante um leilão de partilha de lucro. Motivado por esta mudança, apresentamos um modelo de leilão de partilha sob afiliação, demonstrando a existência de um equilíbrio monótono em estratégias puras e caracterizando a solução. Alem disso, provamos que este mecanismo gera receita esperada maior ou igual a um leilão de primeiro preço usual. Em seguida, introduzimos no modelo uma função representando taxas de royalties que dependem do valor do objeto. Este instrumento permite uma elevação na receita esperada de ambos os modelos, fazendo com que a diferença entre eles encolha. Finalmente, analisando o novo marco regulatório sob o ponto de vista dos resultados obtidos, concluímos que o antigo modelo de concessão utilizado pelo governo brasileiro é mais adequado e lucrativo.

The Brazilian class C women perception regarding premium mass products in the beauty industry

Recentemente, os mercados emergentes se tornaram um alvo potencial para a indústria da beleza e o Brasil está se tornando um mercado lucrativo para os produtos cosméticos Premium (Euromonitor International, 2013). A população de baixa renda no Brasil representa 70% de seus habitantes ao considerar as classes C, D e E (Barki e Parente, 2010), sendo a classe C representada por 56% da população (Neri, 2012). Este é um mercado potencial para as empresas multinacionais (MNCs), que enfrentam desafios de fazer negócios no país, visto que a classe C opta por gastar parte de sua renda com produtos relacionados a beleza (Silva e Parente, 2007) e ainda há um pouco conhecimento sobre o comportamento de consumo na base da pirâmide. Portanto, o objetivo deste estudo é investigar e descrever o comportamento de consumo das mulheres brasileiras da classe C no setor de beleza, em relação aos produtos Mass Premium, melhorando o conhecimento no que diz respeito a essa população e ao tema proposto. Para atingir esse objetivo, o autor utilizou uma metodologia baseada em uma análise descritivas qualitativa em que foram entrevistadas 20 mulheres de todas as faixas etárias, que pertencem à classe C brasileira e citações foram usadas para fornecer a confirmação dos resultados da análise. Os resultados sugerem que, ao longo dos anos, houve de fato um movimento de trade up no consumo de produtos de beleza. Além disso, foram identificados cinco aspectos principais, que conduzem decisão de compra das mulheres de classe C, no setor de beleza: confiabilidade, qualidade, status, autoestima e bem-estar. Apesar das limitações de um estudo exploratório, espera-se que a pesquisa aumente o conhecimento sobre o mercado da base da pirâmide, especialmente no que diz respeito à indústria da beleza.

Automatic model selection for forecasting brazilian stock returns

This study aims to contribute on the forecasting literature in stock return for emerging markets. We use Autometrics to select relevant predictors among macroeconomic, microeconomic and technical variables. We develop predictive models for the Brazilian market premium, measured as the excess return over Selic interest rate, Itaú SA, Itaú-Unibanco and Bradesco stock returns. We nd that for the market premium, an ADL with error correction is able to outperform the benchmarks in terms of economic performance. For individual stock returns, there is a trade o between statistical properties and out-of-sample performance of the model.

Main obstacles in the business environment affecting firm growth: a comparative analysis between Chinese and Brazilian SMEs

Usando dados do Banco Mundial, esta dissertação analisa as semelhanças e diferenças entre os obstáculos enfrentados pelas micro, pequenas e médias empresas (MSME) no Brasil e na China. Realizamos tanto uma análise comparativa entre os dos países como uma análise de clusters para confrontar os dados subjetivos e objetivos recolhidos, de modo a identificar o desempenho das empresas, levando em consideração as características dos países e o ambiente de negócios.

Exploring attitudes and behavioral intention of brazilian consumers towards fair trade and fair trade products

As vendas globais de produtos FT cresceram de forma consistente nos últimos anos. De acordo com a FLO, as vendas cresceram de menos de € 1 bilhão em 2004 para cerca de € 5,5 bilhões em 2013. Apesar do movimento ainda estar engatinhando no Brasil, alguns esforços visando a institucionalização da FT estão sendo tomados. Por exemplo, o Schneider (2012) mostrou que existe um mercado potencial para os produtos FT no Brasil. Entretanto, ele ainda não é bem desenvolvido. Portanto, há uma necessidade de compreender melhor as variáveis que afetam a intenção de compra destes produtos. Estudos anteriores identificaram fatores que são considerados previsores de intenção de comprar produtos FT. Considerando esses fatores, o presente estudo tem como objetivo determinar as variáveis que estão mais relacionadas com a intenção de compra e disposição para pagar por produtos FT no Brasil. Com base nas respostas de 124 entrevistados, os resultados mostram que a intenção de compra de produtos FT no Brasil está ligada a atitudes de consumo éticas dos consumidores, o interesse e qualidade dos produtos, baixo ceticismo e percepção de relevância acerca do conceito FT. Os resultados também mostraram dois grupos antagônicos de consumidores a respeito de suas atitudes. O grupo dos "ativistas" tem atitudes positivas, de alta intenção de compra e disposição a pagar mais. Por outro lado, os "incrédulos" têm atitudes negativas, baixa intenção de compra e não estão dispostos a pagar mais. Com base nos resultados deste estudo, organizações e indivíduos que visam fomentar o mercado FT no Brasil podem entender melhor o consumidor e tomar decisões de marketing mais assertivas, considerando a relevância dos fatores que afetam a intenção de comprar, como também as diferenças entre os consumidores.

Forecast comparison with nonlinear methods for brazilian industrial production

Este trabalho avalia as previsões de três métodos não lineares — Markov Switching Autoregressive Model, Logistic Smooth Transition Autoregressive Model e Autometrics com Dummy Saturation — para a produção industrial mensal brasileira e testa se elas são mais precisas que aquelas de preditores naive, como o modelo autorregressivo de ordem p e o mecanismo de double differencing. Os resultados mostram que a saturação com dummies de degrau e o Logistic Smooth Transition Autoregressive Model podem ser superiores ao mecanismo de double differencing, mas o modelo linear autoregressivo é mais preciso que todos os outros métodos analisados.

French wine and the Brazilian consumer

Em um mercado internacional de vinhos cada dia mais competitivo, exportadores franceses estão procurando novos mercados para expandir suas atividades. Nesse cenário o Brasil aparece como um mercado potencial enorme e, por isso, é necessário aos empreendedores o perfeito entendimento das dinâmicas de mercado, a fim de moldar estratégias de marketing eficientes. A primeira etapa é entender o comportamento do consumidor final, a fim de oferecer o produto certo de maneira certa. Essa dissertação tem por objeto a análise dos hábitos de consumo, bem como a percepção do consumidor sobre os vinhos franceses no mercado do vinho brasileiro. A análise será efetuada em função do comportamento do consumidor; portanto, uma atenção especial será dada à demografia, aos hábitos de consumo e as tendências do mercado para os produtos vitivinícolas. Mais precisamente, a investigação tentará identificar diferentes grupos de consumidores com padrões semelhantes, baseados em dados demográficos, consumo atual ou potencial de vinho, e sua percepção particular sobre o vinho francês. A idéia por trás desse processo é a construção de um quadro que pode ajudar a desenvolver estratégias de marketing para profissionais do mercado de vinhos franceses no Brasil, fornecendo a potenciais exportadores uma melhor compreensão sobre como direcionar o seu posicionamento e atingir metas de forma eficaz. A realização desta dissertação foi um desafio importante porque o comportamento do consumidor de vinho no Brasil nao foi estudado inteiramente. É muito difícil hoje para exportadores franceses que desejam compreender melhor o consumidor brasileiro de vinho encontrar qualquer estudo ou análise. A fim de fazer isso, a literatura sobre o mercado do vinho brasileiro foi utilizada (especificidades dos produtos, produção, dados de consumo, etc.). A literatura também inclui os fatores de decisão que influenciam os consumidores nas suas decisões de compra, o que é uma questão muito complexa quando se trata de vinho. Finalmente, a literatura sobre as estratégias de marketing foi revista, a fim de avaliar o tanto o impacto potencial como a relevância para o mercado brasileiro. A segunda etapa do estudo foi a apresentação de questionários a consumidores brasileiros e a análise, com o intuito de determinar as preferências dos consumidores e compreender a percepção do vinho francês. O objetivo foi identificar potenciais grupos alvos para os produtores franceses de vinho.