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The Brazilian Economy in Transition: Macroeconomic Policy, Labor and Inequality

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  • Mark Weisbrot
  • Jake Johnston
  • Stephan Lefebvre

Abstract

The Brazilian economy has gone through a significant transformation during the past decade. Following nearly a quarter-century with very little growth in per capita GDP, there was a major change beginning in 2004. GDP per person (adjusted for inflation) grew at a rate of 2.5 percent annually from 2003-2014, more than three times faster than the 0.8 percent annual growth of the prior government (1995-2002). This growth rate was achieved in spite of the 2008-09 global financial crisis and recession, which pushed Brazil into recession in 2009; and this comparison includes the slowdown of the past few years. Over the past decade there have also been sharp declines in unemployment, poverty, and extreme poverty, as well as a large shift towards less inequality in the distribution of income gains. This paper looks at these changes as well as government policy changes that have contributed to them. It also looks at the economic slowdown over the past few years, and the role of macroeconomic policy since 2011.

Suggested Citation

  • Mark Weisbrot & Jake Johnston & Stephan Lefebvre, 2014. "The Brazilian Economy in Transition: Macroeconomic Policy, Labor and Inequality," CEPR Reports and Issue Briefs 2014-14, Center for Economic and Policy Research (CEPR).
    • Handle: RePEc:epo:papers:2014-14
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    File URL: http://www.cepr.net/documents/brazil-2014-09.pdf
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    References listed on IDEAS

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    1. David Kupfer & Marta Castilho & Esther Dweck & Marcelo Nicoll, 2013. "Different Partners, Different Patterns: Trade and Labour Market Dynamics in Brazil's Post-Liberalisation Period," OECD Trade Policy Papers 149, OECD Publishing.
    2. David Rosnick & Mark Weisbrot, 2014. "Latin American Growth in the 21st Century: The 'Commodities Boom' That Wasn't," CEPR Reports and Issue Briefs 2014-09, Center for Economic and Policy Research (CEPR).
    3. Jens Matthias Arnold & João Jalles, 2014. "Dividing the Pie in Brazil: Income Distribution, Social Policies and the New Middle Class," OECD Economics Department Working Papers 1105, OECD Publishing.
    4. Moreira, Tito Belchior S. & Ribeiro Soares, Fernando Antônio, 2012. "Brazil: the international financial crisis and counter-cyclical policies," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.
    5. Andre de Queiroz Brunelli, 2014. "Two Decades of Structural Shifts in the Brazilian Labor Market: assessing the unemployment rate changes through stylized facts on labor supply and labor demand," Working Papers Series 348, Central Bank of Brazil, Research Department.
    6. Fabio Veras Soares, 2005. "The impact of trade liberalisation on the informal sector in Brazil," Working Papers 7, International Policy Centre for Inclusive Growth.
    7. Mr. Irineu E de Carvalho Filho & Mr. Marcello M. Estevão, 2012. "Institutions, Informality, and Wage Flexibility: Evidence From Brazil," IMF Working Papers 2012/084, International Monetary Fund.
    8. André Moreira Cunha & Daniela Magalhães Prates & Fernando FerrariFilho, 2011. "Brazil Responses to the International Financial Crisis: A Successful Example of Keynesian Policies?," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 58(5), pages 693-714, December.
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    Citations

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    Cited by:

    1. Franklin Serrano & Ricardo Summa, 2015. "Aggregate demand and the slowdown of Brazilian economic growth in 2011-2014 [Aggregate demand and the slowdown of Brazilian economic growth in 2011-2014]," Nova Economia, Economics Department, Universidade Federal de Minas Gerais (Brazil), vol. 25(spe), pages 803-833, December.
    2. Joshua Greenstein, 2015. "New patterns of structural change and effects on inclusive development: A case study of South Africa and Brazil," WIDER Working Paper Series 006, World Institute for Development Economic Research (UNU-WIDER).
    3. Themba Mbangata & Ogujiuba Kanayo, 2017. "A Review of the Macroeconomic Policy Frameworks adopted by the BRICS countries (2000-2015)," Journal of Economics and Behavioral Studies, AMH International, vol. 9(3), pages 202-211.
    4. Franklin Serrano & Ricardo Summa, 2015. "Measuring Recovery: Aggregate Demand and the Slowdown of Brazilian Economic Growth from 2011-2014," CEPR Reports and Issue Briefs 2015-19, Center for Economic and Policy Research (CEPR).
    5. Serrano, Franklin & Summa , Ricardo, 2015. "Distribution and Cost-Push inflation in Brazil under inflation targeting, 1999-2014," Centro Sraffa Working Papers CSWP14, Centro di Ricerche e Documentazione "Piero Sraffa".
    6. Joshua Greenstein, 2015. "New patterns of structural change and effects on inclusive development: A case study of South Africa and Brazil," WIDER Working Paper Series wp-2015-006, World Institute for Development Economic Research (UNU-WIDER).
    7. Charles H. Klein & Sean T. Mitchell & Benjamin Junge, 2018. "Naming Brazil's previously poor: “New middle class†as an economic, political, and experiential category," Economic Anthropology, Wiley Blackwell, vol. 5(1), pages 83-95, January.

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    More about this item

    Keywords

    brazil; economic growth; macroeconomic policy;
    All these keywords.

    JEL classification:

    • E - Macroeconomics and Monetary Economics
    • E0 - Macroeconomics and Monetary Economics - - General
    • F - International Economics
    • F1 - International Economics - - Trade
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F17 - International Economics - - Trade - - - Trade Forecasting and Simulation

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