The Dutch disease and its neutralization: a Ricardian approach

The Dutch disease is a major market failure originated in the existence of cheap and abundant natural or human resources that keep overvalued the currency of a country for an undetermined period of time, thus turning non profitable the production of tradable goods using technology in the state-of-the-art. It is an obstacle to growth on the demand side, because it limits investment opportunities. The severity of the Dutch disease varies according to the extent of the Ricardian rents involved, i.e., according to the difference between two exchange rate equilibriums: the ‘current’ or market rate and the ‘industrial’ rate - the one that make viable efficient tradable industries. Its main symptoms, besides overvalued currency, are low rates of growth of the manufacturing industry, artificially high real wages, and unemployment. Its neutralization requires managing the exchange rate. The principal instrument for that is a sales or export tax on the commodities that give origin to the Dutch disease. In order to neutralize it policymakers face major political obstacles since it involves taxing exports and reducing wages. Finally, this papers argues that there is an extended concept of Dutch disease: besides having its origin in natural resources, it may arise from cheap labor provided that the ‘wage spread’ in the developing country is considerably larger than in the developed one - a condition that is usually present.

Fertilizer policy in the developing countries: the case of Brazil

This paper deals initially with the role of mineral fertilizers in increasing agricultural production: the relationship between the two variables is illustrated within global, regional national and local contexts. The pattern and trends in fertilizer usage in Brazil are presented next, namely: increase in consumption in the period 1950/72; regional distribution; consumption as related to crops and cultivated land. It is shown that in less than a quarter or century fertilizer use has increased in the country nearly 12 fold, whereas world consumption was raised 7 fold, thus exceeding estimates based in several criteria. Steps taken to secure the raise in fertilizer consumption above the historical trend are discussed: research experience for outlining fertilization recomendations; the transfer of the knowledge to the farmer by the extension work both official and private; the credit policy and special incentives for the purchase of fertilizer; the national policy for minumum proces of agricultural products; the implantation of a national fertilizer industry. It is considered that the Brazilian experience adapted to similar local conditions in other developing countries, presents a possibility for achieving beneficial results without inflationary reflexes in the economy.

Corruption, income, and rule of law: empirical evidence from developing and developed economies

This article presents an empirical analysis based on cross-country data concerned with two points regarding corruption: (i) its effects on income; and (ii) how to mitigate corruption. The findings can be highlighted in two points. Firstly the idea that corruption is intrinsically connected with income is confirmed. Secondly, the traditional argument that an increase in rule of law represents a good strategy in the fight against corruption is valid for developing countries. Furthermore, this study reveals that the search for increasing the human development index represents a rule of thumb for high levels of income and to control corruption.

Brazilian foreign policy under President Lula (2003-2010): an overview

Foreign Minister of Brazil since 2003, Ambassador Celso Amorim outlines the main guidelines and accomplishments of Brazil's foreign policy under President Luiz Inácio Lula da Silva. The article provides a full-fledged, although not exhaustive, narrative of a number of diplomatic initiatives championed by Brazil over the last eight years: from the gathering of the group of developing countries in a World Trade Organization (WTO) meeting in Cancun to the negotiations that led to the Declaration of Tehran, as well as the challenges the country has been facing as its international weight grows.

Five generations of peace operations: from the "thin blue line" to "painting a country blue"

This article combines both international practice and analytical contributions into a systematic and synthetic presentation of the evolution of peace operations from their modern inception in 1948 to the present. It seeks to serve a didactic purpose in proposing a basic structure for Brazilian scholars' burgeoning debate on peace operations and intervention, rather than a definitive characterization of blue helmet practice. Peace operations' progression is traced through five analytical "generations," each adding a crucial factor distinguishing it from its predecessors. Each generation is placed in relation to changes in the nature of conflict and in the interpretation of the foundational principles of peace operations, and links to broader theoretical issues in International Relations are made explicit at each stage.

From Tegucigalpa to Teheran: Brazil's diplomacy as an emerging Western country

This paper reviews Brazil's pursuit for international insertion by: discussing its search for new partners; presenting an overview of the historical, cultural, and political features that render it the most Western of the emerging nations; and analyzing its participation in the management of two major international crises, the Honduran constitutional crisis and the Iranian nuclear crisis.

Developing management systems for emerging countries

Application of Western management theories in different contexts has been questioned for several decades. However, there is still no well-defined theoretical framework for understanding management systems in non-industrialized countries. This article provides some guidelines to develop these frameworks by elaborating some of the major characteristics of strategies, structures, decision-makings and management systems in Developing Countries (DC). The analysis showed evidence that the complexity of national environmental forces of DCs has made the application of Western management theories more problematic in these countries. The article concludes that global business firms should realize that it is time to stop transferring these management systems to DCs and trying to adapt their organizations to these systems and that a clinical type of approach may be more effective.

CROSS-COUNTRY STUDY ON THE DETERMINANTS OF BANK FINANCIAL DISTRESS

ABSTRACTBank failures affect owners, employees, and customers, possibly causing large-scale economic distress. Thus, banks must evaluate operational risks and develop early warning systems. This study investigates bank failures in the Organization for Economic Co-operation and Development, the North America Free Trade Area (NAFTA), the Association of Southeast Asian Nations, the European Union, newly industrialized countries, the G20, and the G8. We use financial ratios to analyze and explore the appropriateness of prediction models. Results show that capital ratios, interest income compared to interest expenses, non-interest income compared to non-interest expenses, return on equity, and provisions for loan losses have significantly negative correlations with bank failure. However, loan ratios, non-performing loans, and fixed assets all have significantly positive correlations with bank failure. In addition, the accuracy of the logistic model for banks from NAFTA countries provides the best prediction accuracy regarding bank failure.

Mortality problems in Brazil and in Germany: past-present-future. Learning from each other?

This article was written by a Swiss-German historical demographer after having visited different Brazilian Universities in 1984 as a guest-professor. It aims at promoting a real dialog between developed and developing countries, commencing the discussion with the question: Can we learn from each other? An affirmative answer is given, but not in the superficial manner in which the discussion partners simply want to give each other some "good advice" or in which the one declares his country's own development to be the solely valid standard. Three points are emphasized: 1. Using infant mortality in S. Paulo from 1908 to 1983 as an example, it is shown that Brazil has at its disposal excellent, highly varied research literature that is unjustifiably unknown to us (in Europe) for the most part. Brazil by no means needs our tutoring lessons as regards the causal relationships; rather, we could learn two things from Brazil about this. For one, it becomes clear that our almost exclusively medical-biological view is inappropriate for passing a judgment on the present-day problems in Brazil and that any conclusions so derived are thus only transferable to a limited extent. For another, we need to reinterpret the history of infant mortality in our own countries up to the past few decades in a much more encompassing "Brazilian" sense. 2. A fruitful dialog can only take place if both partners frankly present their problems. For this reason, the article refers with much emprasis to our present problems in dealing with death and dying - problems arising near the end of the demographic and epidemiologic transitions: the superanuation of the population, chronic-incurable illnesses as the main causes of death, the manifold dependencies of more and more elderly and really old people at the end of a long life. Brazil seems to be catching up to us in this and will be confronted with these problems sooner or later. A far-sighted discussion already at this time seems thus to be useful. 3. The article, however, does not want to conclude with the rather depressing state of affairs of problems alternatingly superseding each other. Despite the caution which definitely has a place when prognoses are being made on the basis of extrapolations from historical findings, the foreseeable development especially of the epidemiologic transition in the direction of a rectangular survival curve does nevertheless provide good reason for being rather optimistic towards the future: first in regards to the development in our own countries, but then - assuming that the present similar tendencies of development are stuck to - also in regard to Brazil.

The engine or the caboose: health policy in developing countries

A discussion of health policy in developing countries is presented. It argues that developing countries must adopt a progressive approach to health policy which rejects the two-tiered system of public and private health care. However, it also points out that ideology is not sufficient to maintain support. A progressive health system must utilize administrative and social and behavioral sciences to achieve effectiveness and efficiency in health care delivery. It cannot ignore these goals any more than a private health care system can.

Maternal neurotic symptoms and infants' risk of developing persistent diarrhoea

A previously calculated predictive model for health risk selects infants who suffer 4-5 times more morbidity than their unselected peers. Preliminary results suggested that this risk is related to maternal neurotic symptomatology. To evaluate this hypothesis, 52 consecutive mothers whose infants had a positive predictive score (Group 1) and 52 in whom this was negative (Group 2) were evaluated by means of Goldberg's General Health Questionnaire (GHQ - 30). A total of 41.9% and 20.5% of the mothers in Groups 1 and 2, respectively, scored above 11 points in GHQ-30, established as the cut off point. It is concluded that among poor urban families in Santiago mothers of infants with high risk of persistent diarrhoea have increased frequency of detectable neurotic symptoms. New programs aimed at this type of infant should include psychological support for their mothers.