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Macroeconomic Performance and Inequality: Brazil 1983-94

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  • M.F.Meyer Bittencourt

Abstract

This paper examines how macroeconomic performance affected earnings inequality during the 1980’s and early 90’s in Brazil. The evidence shows that the chronic high inflation existent at the time had a clear and significant effect in raising inequality. The results based on panel time series data and analysis are robust for different concepts of inflation, inequality measures, estimators and specifications. The economic intuition suggests that high inflation rates combined with incomplete indexation coverage more than offset any progressive effect expectedly coming from the debtor and creditor channel. Hence, credible and stable macroeconomic policies, which keep inflation low and under control in the long run is to be a necessary first step of any public policy package implemented to tackle the high levels of inequality existent in Brazil.

Suggested Citation

  • M.F.Meyer Bittencourt, 2005. "Macroeconomic Performance and Inequality: Brazil 1983-94," The Centre for Market and Public Organisation 05/114, The Centre for Market and Public Organisation, University of Bristol, UK.
  • Handle: RePEc:bri:cmpowp:05/114
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    Cited by:

    1. Bittencourt, Manoel, 2011. "Inflation and financial development: Evidence from Brazil," Economic Modelling, Elsevier, vol. 28(1), pages 91-99.
    2. Manoel Bittencourt, 2013. "Economic Growth and Inequality: Evidence from the Young Democracies of South America," Working Papers 361, Economic Research Southern Africa.
    3. Manoel Bittencourt, 2009. "Polarisation, Populism and Hyperinflation[s]: Some Evidence from Latin America," Working Papers 200921, University of Pretoria, Department of Economics.
    4. Bittencourt, Manoel, 2012. "Inflation and economic growth in Latin America: Some panel time-series evidence," Economic Modelling, Elsevier, vol. 29(2), pages 333-340.
    5. Azevedo, Joao Pedro & David, Antonio C. & Bastos, Fabiano Rodrigues & Pineda, Emilio, 2014. "Fiscal adjustment and income inequality : sub-national evidence from Brazil," Policy Research Working Paper Series 6945, The World Bank.
    6. Manoel Bittencourt, 2011. "Is Copacabana Still the ‘Little Princess of the Sea’?," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 12(01), pages 11-16, March.
    7. Manoel F. Meyer Bittencourt, 2006. "Financial Development and Inequality: Brazil 1985-99," Working Papers 26, ECINEQ, Society for the Study of Economic Inequality.
    8. Bittencourt, Manoel, 2010. "Democracy, Populism and Hyperinflation[s]: Evidence from Latin America," Proceedings of the German Development Economics Conference, Hannover 2010 47, Verein für Socialpolitik, Research Committee Development Economics.
    9. Manoel Bittencourt, 2014. "Economic Growth and Inequality: Evidence from the Young Democracies of South America," International Symposia in Economic Theory and Econometrics, in: Macroeconomic Analysis and International Finance, volume 23, pages 37-58, Emerald Group Publishing Limited.
    10. Sintos, Andreas, 2023. "Does inflation worsen income inequality? A meta-analysis," Economic Systems, Elsevier, vol. 47(4).
    11. Binder, Carola, 2019. "Inequality and the inflation tax," Journal of Macroeconomics, Elsevier, vol. 61(C), pages 1-1.
    12. Manoel Bittencourt, 2012. "Democracy, populism and hyperinflation: some evidence from Latin America," Economics of Governance, Springer, vol. 13(4), pages 311-332, December.

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    More about this item

    Keywords

    Inequality; inflation; indexation;
    All these keywords.

    JEL classification:

    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General
    • D30 - Microeconomics - - Distribution - - - General
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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