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Crítica do crescimento com poupança externa

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  • Pereira, Luiz C. Bresser
  • Gala, Paulo

Abstract

The present paper is a formalization of the critique of the growth with foreign savings strategy. Although medium income countries are capital poor, current account deficits (foreign savings), financed either by loans or by foreign direct investments, will not usually increase the rate of capital accumulation or will have little impact on it in so far as current account deficits will be associated with appreciate exchange rates, increased real wages and salaries and high consumption levels. In consequence, the rate of substitution of foreign savings for domestic savings will be relatively high, and the country will get indebted to consume, not to invest and grow. Only when there are large investment opportunities, stimulated by a sizeable difference between the expected rate of profit and the long term interest rate, additional income originated by foreign capital flows will be used for investment and this trade-off between foreign savings and domestic savings reduction will not occur

Suggested Citation

  • Pereira, Luiz C. Bresser & Gala, Paulo, 2005. "Crítica do crescimento com poupança externa," Textos para discussão 145, FGV/EESP - Escola de Economia de São Paulo, Getulio Vargas Foundation (Brazil).
  • Handle: RePEc:fgv:eesptd:145
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    References listed on IDEAS

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    1. Guillermo A. Calvo & Leonardo Leiderman & Carmen M. Reinhart, 1993. "Capital Inflows and Real Exchange Rate Appreciation in Latin America: The Role of External Factors," IMF Staff Papers, Palgrave Macmillan, vol. 40(1), pages 108-151, March.
    2. Luiz Carlos Bresser-Pereira & Carmen Augusta Varela, 2004. "The second Washington consensus and Latin America's quasi-stagnation," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 27(2), pages 231-250.
    3. Pereira, Luiz C. Bresser & Nakano, Yoshiaki, 2002. "Economic growth with foreign saving?," Textos para discussão 118, FGV/EESP - Escola de Economia de São Paulo, Getulio Vargas Foundation (Brazil).
    4. Feldstein, Martin & Horioka, Charles, 1980. "Domestic Saving and International Capital Flows," Economic Journal, Royal Economic Society, vol. 90(358), pages 314-329, June.
    5. Sinn, Stefan, 1992. "Saving-Investment Correlations and Capital Mobility: On the Evidence from Annual Data," Economic Journal, Royal Economic Society, vol. 102(414), pages 1162-1170, September.
    6. Reinhart, Carmen M. & Talvi, Ernesto, 1998. "Capital flows and saving in Latin America and Asia: a reinterpretation," Journal of Development Economics, Elsevier, vol. 57(1), pages 45-66, October.
    7. Luiz Carlos Bresser-Pereira, 2002. "Brazil's Quasi-Stagnation and the Growth cum Foreign Savings Strategy," International Journal of Political Economy, Taylor & Francis Journals, vol. 32(4), pages 76-102.
    8. Coakley, Jerry & Kulasi, Farida & Smith, Ron, 1996. "Current Account Solvency and the Feldstein-Horioka Puzzle," Economic Journal, Royal Economic Society, vol. 106(436), pages 620-627, May.
    9. Barry Eichengreen & David Leblang, 2003. "Capital account liberalization and growth: was Mr. Mahathir right?," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 8(3), pages 205-224.
    10. Pereira, Luiz C. Bresser, 2002. "Financiamento para o subdesenvolvimento, o Brasil e o segundo consenso de Washington," Textos para discussão 119, FGV/EESP - Escola de Economia de São Paulo, Getulio Vargas Foundation (Brazil).
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