Déficits gêmeos e poupança nacional: abordagem teórica

A consensus has not yet emerged about the relationship between budget deficit, external deficit and national saving. According to mainstream economic literature the budget deficit can cause an insufficiency of national saving for a given investment rate. In this case, the investment rate will not be reduced if foreign saving is absorbed, causing an external deficit. In general, the mechanisms through which budget deficits could cause current account deficits are not highlighted in the works about this theme. We arrive at the conclusion that there is not a systematic relationship between budget deficit, current account deficit and national saving and that when it happens it can be processed only through changes in the real exchange rate.

Macroeconomia estruturalista do desenvolvimento

Structuralist development macroeconomics. This paper presents some basic ideas and models of a structuralist development macroeconomics (the tendencies to the overvaluation of the exchange rate and the tendency of wages to grow below productivity, the critique of growth with foreign savings, and a new model of the Dutch disease) that complement and actualize the thought of the Latin-American structuralist school that developed around ECLAC from the late 1940s to the 1960s. On the other hand, it suggests that a new national development strategy based on the experience of fast growing Asian countries is emerging; and argues that only the countries that adopt such strategy based on growth with domestic savings, fiscal and foreign trade responsibility and a competitive exchange rate will be able to catch up.

Structuralist macroeconomics and the new developmentalism

This paper first presents some basic ideas and models of a structuralist development macroeconomics that complements and actualizes the ideas of the structuralist development economics that was dominant between the 1940s and the 1960s. A system of three models focusing on the exchange rate (the tendency to the cyclical overvaluation of the exchange rate, a critique of growth with foreign savings, and new a model of the Dutch disease) shows that it is not just volatile but chronically overvalued, and for that reason it is not just a macroeconomic problem; as a long term disequilibrium, it is in the core of development economics. Second, it summarizes "new developmentalism" - a sum of growth policies based on these models and on the experience of fast-growing Asian countries.

Exchange rate pass-through inflation and wage differentials in late-industrializing economies: the Mexican case

This paper investigates exchange rate pass-through inflation, and the wage bargaining process, in a developing economy in which firms' market power is largely dependent on technical progress embodied in imported intermediates and capital goods. It develops a heterodox model of income distribution, based on theoretical contributions from Latin American structuralists, labor market segmentationists and post-Keynesian writers, and it presents supportive empirical evidence from the Mexican economy.

The industrial equilibrium exchange rate in Brazil: an estimation

This paper presents a methodology for calculating the industrial equilibrium exchange rate, which is defined as the one enabling exporters of state-of-the-art manufactured goods to be competitive abroad. The first section highlights the causes and problems of overvalued exchange rates, particularly the Dutch disease issue, which is neutralized when the exchange rate strikes the industrial equilibrium level. This level is defined by the ratio between the unit labor cost in the country under consideration and in competing countries. Finally, the evolution of this exchange rate in the Brazilian economy is estimated.

Effects of overvaluation and exchange rate volatility over industrial investment: empirical evidence and economic policy proposals for Brazil

The present article aims to analyze the recent behavior of real exchange rate in Brazil and its effects over investment per worker in Brazilian manufacturing and extractive industry. Preliminary estimates presented in the article shows an over-valuation of 48% of real exchange rate in Brazil. The reaction between the level (and volatility) of real exchange rate and investment (per worker) in Brazil is analyzed by means of a panel data econometric model for 30 sectors of Brazilian manufacturing and extractive industry. The empirical results show that the level and volatility of real exchange rate has a strong effect over investment per worker in Brazilian industry. Finally, we conclude the article presenting a proposal for a new macroeconomic regime that aims to produce an acceleration of economic growth of Brazilian economy and, by that, a catching-up process with developed countries.

Trade rules and exchange rate misalignments: in search for a WTO solution

The debate on the link between trade rules and rules on exchange rates is raising the attention of experts on international trade law and economics. The main purpose of this paper is to analyze the impacts of exchange rate misalignments on tariffs as applied by the WTO - World Trade Organization. It is divided into five sections: the first one explains the methodology used to determine exchange rate misalignments and also presents its results for Brazil, U.S. and China; the second summarizes the methodology applied to calculate the impacts of exchange rate misalignments on the level of tariff protection through an exercise of "misalignment tariffication"; the third examines the effects of exchange rate variations on tariffs and their consequences for the multilateral trading system; the fourth one creates a methodology to estimate exchange rates against a currency of the World and a proposal to deal with persistent and significant misalignments related to trade rules. The conclusions are present in the last section.

Vulnerabilidade externa e composição da posição internacional de investimentos: Brasil 2001-2010

The aim of this paper is to indicate that there was a significant change in the composition of the Brazilian International Investment Position in the period 2001-2010: international reserves became higher than the external debt and decreased the share of foreign liabilities denominated in foreign currency, getting smaller that the participation of the external liabilities denominated in domestic currency. These tend to suffer a double devaluation (prices and exchange rates) in times of crisis, thus characterizing the reduction of the external vulnerability in the financial sphere as evidenced in the global crisis hatched in 2008.

Institutions, credibility and crisis: the inconsistencies of Argentine exchange rate policy (1991-2006)

The purpose of this article is twofold. The first is to explain the time inconsistencies of the convertibility regime that led to the 2001 crisis. The argument suggests that the credibility requirements for convertibility induced a dynamic of legal, fiscal, financial and external commitments that increased exit costs and time inconsistencies. The second objective is to explain the tensions of the floating regime that replaced convertibility in 2002. We describe the effects of a floating exchange rate on macroeconomic imbalance and the growing tension between competitiveness and inflation.

Crawling up the value chain: domestic institutions and non-traditional foreign direct investment in Brazil, 1990-2010

Brazil attracted relatively little innovation-intensive and export-oriented foreign investment during the liberalization period of 1990 to 2010, especially compared with competitors such as China and India. Adopting an institutionalist perspective, I argue that multinational firm investment profiles can be partly explained by the characteristics of investment promotion policies and bureaucracies charged with their implementation. Brazil's FDI policies were passive and non-discriminating in the second half of the 1990s, but became more selective under Lula. Investment promotion efforts have often been undercut by weakly coordinated and inconsistent institutions. The paper highlights the need for active, discriminating investment promotion policies if benefits from non-traditional FDI are to be realized.