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Trade Liberalization and the Political Economy of Protection in Brazil since 1987


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  • Marcelo de Paiva Abreu


The paper analyses aspects of trade liberalization and the political economy of protection in Brazil since 1987. Section I considers the internal and external constraints to the continued adoption of a strategy based on import substitution industrialization. In section II trade liberalization up to 1994 is described including its adjustments related to the creation of Mercosur. It also places trade liberalization in the context of the wider reforms implemented in Brazil in the 1990s. The impacts of trade liberalization on import penetration, productivity and the cost of investment as well as its distributive effects are examined in section III. The relative importance of trade liberalization and inflation acceleration on the cost of investment is also discussed. Section IV deals with the political economy of trade liberalization and the protectionist backlash in the mid-1990s. An analysis is made of long-term factor mobility and the Brazilian case is compared with findings on other economies about the transition from a political economy of protection centered on the clash of "class interests" to one concerned with "special interests".

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Bibliographic Info

Paper provided by Inter-American Development Bank in its series IDB Publications with number 9376.

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Date of creation: Apr 2004
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Handle: RePEc:idb:brikps:9376

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Keywords: Economics; Integration & Trade; SITI Working Paper N° 8b; INTAL; Política Económica; Libre Comercio;


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Cited by:
  1. Marta Castilho & Marta Menéndez & Aude Sztulman, 2014. "Trade Liberalization, Inequality and Poverty in Brazilian States," PSE - G-MOND WORKING PAPERS, HAL halshs-00967356, HAL.
  2. Castilho, Marta & Menéndez, Marta & Sztulman, Aude, 2012. "Trade Liberalization, Inequality, and Poverty in Brazilian States," World Development, Elsevier, Elsevier, vol. 40(4), pages 821-835.
  3. Manuel Orozco & Rachel Fedewa, 2007. "Leveraging efforts on remittances and financial intermediation," INTAL Working Papers, Inter-American Development Bank, INTAL 1448, Inter-American Development Bank, INTAL.
  4. Mario Jales & Marcos Sawaya Jank & Shunli Yao & Colin Carter, 2006. "Agriculture in Brazil and China : challenges and opportunities," INTAL Working Papers, Inter-American Development Bank, INTAL 1296, Inter-American Development Bank, INTAL.
  5. Marcelo de Paiva Abreu, 2006. "The FTAA and the Political Economy of Protection in Brazil and the U.S," IDB Publications, Inter-American Development Bank 9403, Inter-American Development Bank.
  6. Elsnit, 2005. "Second Annual Conference of the Euro-Latin Study Network on Integration and Trade, ELSNIT : Issues papers," INTAL Working Papers, Inter-American Development Bank, INTAL 2414, Inter-American Development Bank, INTAL.
  7. Eric T. Miller, 2005. "Achievements and challenges of trade capacity building : a practitioner's analysis of the CAFTA process and its lessons for the multilateral system," INTAL Working Papers, Inter-American Development Bank, INTAL 1268, Inter-American Development Bank, INTAL.
  8. Juan S. Blyde, 2006. "Assessing the impacts of intellectual property rights on trade flows in Latin America," INTAL Working Papers, Inter-American Development Bank, INTAL 1274, Inter-American Development Bank, INTAL.
  9. Ferreira, Francisco H.G. & Leite, Phillippe G. & Ravallion, Martin, 2010. "Poverty reduction without economic growth?: Explaining Brazil's poverty dynamics, 1985-2004," Journal of Development Economics, Elsevier, Elsevier, vol. 93(1), pages 20-36, September.
  10. Vito Tanzi, 2005. "The production and financing of regional public goods," INTAL Working Papers, Inter-American Development Bank, INTAL 2824, Inter-American Development Bank, INTAL.
  11. repec:hal:psewpa:halshs-00967356 is not listed on IDEAS
  12. Vito Tanzi, 2005. "Building regional infrastructure in Latin America," INTAL Working Papers, Inter-American Development Bank, INTAL 2642, Inter-American Development Bank, INTAL.
  13. Gaddis, Isis & Pieters, Janneke, 2012. "Trade Liberalization and Female Labor Force Participation: Evidence from Brazil," IZA Discussion Papers, Institute for the Study of Labor (IZA) 6809, Institute for the Study of Labor (IZA).


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