The Political Economy of Monetary Institutions in Brazil: The Limits of the Inflation-targeting Strategy, 1999-2005
This paper suggests that the time-inconsistency approach is inadequate to analyze the political economy of monetary policy in Brazil. The paper develops an alternative theory that emphasizes distributive conflict, and argues that building credibility with a fixed exchange rate and through inflation-targeting was not central for stabilization. A contested-terrain analysis of the Brazilian case suggests that the current monetary regime benefits financial or rentier interests while the manufacturing sector and workers bear the costs of this policy.
Volume (Year): 20 (2008)
Issue (Month): 1 ()
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