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Structural Change and Economic Growth under External Constraint in Brazil: An Empirical Analysis


  • Raphael Rocha Gouvêa


  • Gilberto Tadeu Lima



By exploring the implications of a Multi-Sector Thirlwall’s Law, this paper reports empirical exercises that contribute to an understanding of the relationship between structural change, external constraint and growth in Brazil in the 1962-2006 period. Given the sectoral nature of these exercises and their connection to the literature about the II National Development Plan, the results were used to evaluate each sectors’ contribution to the evolution of the weighted income elasticities of exports and imports during the period. These findings provide additional support to the existing debate about the external adjustment promoted between 1974 and 1984. The results suggest that Castro’s (1985) interpretation has empirical support, even if evaluated using a different metric than the one used by the author. But, the results also support Fishlow’s (1986) qualification that the improvement in the trade balance in 1983-1984 was due to a greater extent to the behavior of exports than to the behavior of imports.

Suggested Citation

  • Raphael Rocha Gouvêa & Gilberto Tadeu Lima, 2011. "Structural Change and Economic Growth under External Constraint in Brazil: An Empirical Analysis," Working Papers, Department of Economics 2011_04, University of São Paulo (FEA-USP).
  • Handle: RePEc:spa:wpaper:2011wpecon04

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    References listed on IDEAS

    1. Arindrajit Dube & Richard B. Freeman, 2010. "Complementarity of Shared Compensation and Decision-Making Systems: Evidence from the American Labor Market," NBER Chapters,in: Shared Capitalism at Work: Employee Ownership, Profit and Gain Sharing, and Broad-based Stock Options, pages 167-199 National Bureau of Economic Research, Inc.
    2. Mark Setterfield (ed.), 2010. "Handbook of Alternative Theories of Economic Growth," Books, Edward Elgar Publishing, number 12814.
    3. Dutt, Amitava Krishna, 1984. "Stagnation, Income Distribution and Monopoly Power," Cambridge Journal of Economics, Oxford University Press, vol. 8(1), pages 25-40, March.
    4. Cahuc, Pierre & Dormont, Brigitte, 1997. "Profit-sharing: Does it increase productivity and employment? A theoretical model and empirical evidence on French micro data," Labour Economics, Elsevier, vol. 4(3), pages 293-319, September.
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    More about this item


    Structural Change; Economic Growth; External Constraint; II PND;

    JEL classification:

    • E10 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models


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