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The asymmetric effects of exchange rate on export performance: revisiting the Dutch disease in Brazil (2011-2024)

Author

Listed:
  • Carlos Eduardo Caldarelli

    (Universidade Estadual de Londrina, Departamento de Economia, Londrina, PR, Brazil)

  • Elisangela Araújo

    (Universidade Estadual de Maringá, Departamento de Economia, Maringá, PR, Brazil | Universidade Federal do Paraná, Curitiba, PR, Brazil)

  • Felipe Orsolin

    (Universidade Federal do Paraná, Curitiba, PR, Brazil)

Abstract

This article investigates, both theoretically and empirically, why exchange rate depreciation did not boost Brazilian manufacturing exports between 2011 and 2024. The assumed hypothesis is that exchange rate effects on manufacturing are asymmetric due to ongoing deindustrialization and reprimarization over recent decades. To test this hypothesis, a dynamic panel data model is estimated using traditional variables, such as the real exchange rate and world income, alongside additional relevant aspects, including the commodity price index and exports disaggregated by technological intensity and resource-based sectors. The main results support the hypothesis, showing that exchange rate depreciation benefited resource-intensive segments but had limited effects on technologically more complex sectors. Therefore, exchange rate policy alone has proved to be insufficient to neutralize the Dutch disease during the period analyzed and, in the absence of complementary industrial and technological policies, tends to reinforce the reprimarization of exports at the expense of higher value-added manufacturing. JEL Classification: O24; L16; Q17.

Suggested Citation

  • Carlos Eduardo Caldarelli & Elisangela Araújo & Felipe Orsolin, 2026. "The asymmetric effects of exchange rate on export performance: revisiting the Dutch disease in Brazil (2011-2024)," Brazilian Journal of Political Economy, FGV EAESP, vol. 46(2), pages 263804-2638, May.
    • Handle: RePEc:ekm:repojs:v:46:y:2026:i:2:id:98254
    DOI: 10.1590/3086-44612026-3804
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    JEL classification:

    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

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