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Boosting Investment and Growth: The Role of Social Pacts in the Brazilian Automotive Industry

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  • Mahrukh Doctor

Abstract

The article examines why the automotive industry invested over US$20 billion in Brazil in the second half of the 1990s, focusing on how political economy factors influenced investment decisions. It is argued that, in a context of economic and policy uncertainty, when the state creates appropriate institutional mechanisms to communicate effectively with business and build a consensus for reform, in the process it also reduces investment risks. The argument is illustrated with the example of the Sectoral Chamber of the Automotive Industry (1991-95), and shows the impact of social concertation in neo-corporatist institutions on foreign direct investment.

Suggested Citation

  • Mahrukh Doctor, 2007. "Boosting Investment and Growth: The Role of Social Pacts in the Brazilian Automotive Industry," Oxford Development Studies, Taylor & Francis Journals, vol. 35(1), pages 105-130.
  • Handle: RePEc:taf:oxdevs:v:35:y:2007:i:1:p:105-130
    DOI: 10.1080/13600810601167629
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    Cited by:

    1. Savita Bhat & N S Siddharthan, 2010. "Human Capital, Labour Productivity and Employment," Working Papers id:3110, eSocialSciences.

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