Convergence in Brazil: recent trends and long run prospects

This paper applies to the analysis of the interstate income distribution in BraziI a set of techniques that have been widely used in the current empirical literature on growth and convergence. Usual measures of dispersion in the interstate income distribution (the coefficient of variation and Theil' s index) suggest that cr-convergence was an unequivoca1 feature of the regional growth experience in BraziI, between 1970 and 1986. After 1986, the process of convergence seems, however, to have sIowed down almost to a halt. A standard growth modeI is shown to fit the regional data well and to expIain a substantial amount of the variation in growth rates, providing estimates of the speed of (conditional) J3-convergence of approximateIy 3% p.a .. Different estimates of the long run distribution implied by the recent growth trends point towards further reductions in the interstate income inequality, but also suggest that the relative per capita incomes of a significant number of states and the number of ''very poor" and "poor" states were, in 1995, already quite c10se to their steady-state values.

The effects of openness on industrial employment in Brazil

Este artigo tem dois objetivos principais. Primeiramente, apresentamos as pnnClpms evidências de que a baixa qualidade do emprego é o maior problema do mercado de trabalho brasileiro. Mostra-se que o país tem absorvido um crescimento da oferta de trabalho significativo ao longo dos últimos anos sem registrar um aumento da taxa de desemprego. No entanto, os postos de trabalho no Brasil são, em média, extremamente precários. Em grande medida, a precariedade do emprego no Brasil está relacionada à alta rotatividade da mão-de-obra, que desincentiva o investimento em treinamento, impedindo o crescimento da produtivid::;de do trabalho. De acordo com os indicadores passíveis de comparação internacional, o Brasil apresenta uma das maiores taxas de rotatividade do mundo. Em segundo lugar, estuda-se a evolução recente do emprego industrial, uma vez que o setor industrial está tradicionalmente associado à geração de bons empregos no Brasil. Mostra-se que o nível de emprego industrial tem se reduzido de forma praticamente contínua desde o início desta década. A estimação de um modelo de ajustamento parcial do emprego nos permite explicar este fenômeno. Mudanças estruturais significativas na elasticidade custo salarial do emprego e no coeficiente de tendência são detectadas a partir do início da década de 90. Um simples modelo teórico é usado de forma a interpretar estas mudanças estruturais como a resposta ótima das empresas industriais ao ambiente de maior competição externa, devido à abertura comercial. Isto, junto com o uso crescente de tecnologias poupadoras de mão-de-obra, são suficientes para explicar a brutal queda do emprego industrial no Brasil ao longo dos últimos seis anos.

Trend following performance with size and liquidity: evidence from US, Brazil and Portugal

Neste trabalho, eu analiso a eficiência de se aplicar estratégias que identificam tendências em mercados de capitais, em três países diferentes, usando um conjunto de variáveis macroeconómicas. Em cada país, a estratégia é testada contra os índices de grande capitalização, pequena capitalização e o índice principal. Eu concluo que, ao combinar os sinais diários obtidos pela estratégia, é possível alcançar retornos ajustados ao risco superiores e reduzir as perdas possíveis do portfólio. No geral, enfatizo os benefícios de usar estratégias que exploram tendências para investidores avessos ao risco, obtendo retornos característicos de capitais próprios com a volatilidade característica de obrigações.

The effects of the minimum wage on earnings and employment in Brazil

This paper analyzes the effects of the mlmmum wage on both, eammgs and employment, using a Brazilian rotating panel data (Pesquisa Mensal do Emprego - PME) which has a similar design to the US Current Population Survey (CPS). First an intuitive description of the data is done by graphical analysis. In particular, Kemel densities are used to show that an increase in the minimum wage compresses the eamings distribution. This graphical analysis is then forrnalized by descriptive models. This is followed by a discussion on identification and endogeneity that leads to the respecification of the model. Second, models for employment are estimated, using an interesting decomposition that makes it possible to separate out the effects of an increase in the minimum wage on number of hours and on posts of jobs. The main result is that an increase in the minimum wage was found to compress the eamings distribution, with a moderately small effect on the leveI of employment, contributing to alleviate inequality.

A model of rural conflict : violence and land reform policy in Brazil

In the past ten years the struggle for land in Brazil has taken the shape of invasions of private land by welI organized groups of land less squatters. It is argued in this paper that these invasions and the resulting contlicts are a direct response to the land reform program which has been adopted by the govemment since 1985. which is based on the expropriation of farms and the creation of settlement projects. The set of formal and informal institutions which compromise the land reform program are used as the background for a game-theory model of rural contlicts. T estable implications are derived trom this model with particular emphasis on the etfect of policy variables on violence. These are then tested with panel data at state levei from 1988 to 1995. - It is shown that govemment policy which has the intent of reducing the amount of violence has the opposite etfect of leading to more incentives for contlicts.

The distribution of male wages in Brazil

This paper examines the evolution of wage inequality in Brazil in the 1980s and 1990s . It tries to investigate the role played by changing economic returns to education and to experience over this period together with the evolution of within-group inequality. It applies a quantile regression approach on grouped data to the Brazilian case. Results using repeated cross-sections of a Brazilian annual household survey indicate that : i) Male wage dispersion remained basically constant overall in the 1980's and 1990' s but has increased substantially within education and age groups. ii) Returns to experience increased significantly over this period, with the rise concentrated on the iliterate/primary school group iii) Returns to college education have risen over time, whereas return to intermediate and high-school education have fallen iv) The apparent rise in within-group inequality seems to be the result of a fall in real wages, since the difference in wage leveIs has dec1ined substantially over the period, especially within the high-educated sample. v) Returns to experience rise with education. vi) Returns to education rise over the life-cycle. vii) Wage inequality increases over the life-cycle. The next step i~ this research will try to conciliate all these stylised facts.

Conditional labour supply, quantile functions in Brazil

The estimation of labor supply elasticities has been an important issue m the economic literature. Yet all works have estimated conditional mean labor supply functions only. The objective of this paper is to obtain more information on labor supply, by estimating the conditional quantile labor supply function. vI/e use a sample of prime age urban males employees in Brazil. Two stage estimators are used as the net wage and virtual income are found to be endogenous to the model. Contrary to previous works using conditional mean estimators, it is found that labor supply elasticities vary significantly and asymmetrically across hours of work. vVhile the income and wage elasticities at the standard work week are zero, for those working longer hours the elasticities are negative.

WeIfare costs of inflation the case for interest-bearing money and empiricaI Estimates for Brazil

We provide in this paper a closed fonn for the Welfare Cost of Inflation which we prove to be closer than Bailey's expression to the correct solution of the corresponding non-separable differential equation. Next, we extend this approach to an economy with interest-bearing money, once again presenting a better appoximation than the one given by Bailey's approach. Finally, empirical estimates for Brazil are presented.