The aims of the Journal is to publish papers with economic analysis applied to specific problems of interest either to public or private sector, especially with quantitative results bringing theory and reality closer.
External disequilibrium and the exchange rate
This paper has two parts. The first one estimates the rate of real devaluation necessary to bring the current account deficit in Brazil from 4.5% of GDP to 2.5% of GDP. To accomplish this reduction without affecting total output, a devaluation between 12.3% and 18.63% would be required. The same reduction in the current account deficit without changes in the exchange rate would demand a decrease in total output of between 11.5% and 14.88%. To achieve at the same time full employment and the reduction in the current account deficit a devaluation of 28.56% would be needed. The second part evaluates critically the exchange rate policy followed after 13.01.99 and try to assess the consequences for the equilibrium exchange rate of considering five possible international scenarios. The devaluation would vary between 23.36% and 99.56% for the most favorable and least favorable scenarios, respectively. The paper finishes with a comparative analysis of alternative exchange rate regimes, from free-floating, dirty-floating, the currency board and full dollarization.
Copyright (c) 1999 Economia Aplicada http://creativecommons.org/licenses/by-nc/4.0
The article begins with a short description of the Larida's proposal with emphasis to the stage named 'transition' and to the phase referred as 'anchor and price stabilization’. Some speculations are made about the reasons behind the non-implementation of the Larida's proposal during the Brazilian stabilization plans. After questioning the ambiguities behind the term 'fundamentals’, the text closes with an elaboration regarding the difficulties arising while fixing the nominal anchor.
Four years after its inception, an overall assessment of the Real Plan reveals ambiguous and paradoxical results. Great success in terms of disinflation was achieved without the deep changes in the fiscal-monetary regime that many considered indispensable for the stabilization of the Brazilian currency. However, a persistent overvaluation of the exchange rate and an acceleration of import liberalization produced large external deficits and rapid growth in the country's international liabilities. Moreover, lax fiscal policy and high domestic interest rates led to an increase in government deficits and short term internal public debt. As a result, the Brazilian economy became financially vulnerable and highly dependent on the availability of foreign resources. The consolidation of monetary stability and a return to sustained economic growth rates require a solution for the public sector’s financial problems and, particularly, the removal of the structural disequilibrium in the external accounts.
Initially this article deals with the worldwide collapse of the exchange rate regimes and the ensuing monetary crises and their influence upon the inflationary experiences after 1979. The author analyses also the great reliance on foreign source of financing during the Real Plan. A critical analysis of the fixed exchange rate regime followed in Brazil after 1994 is then included in the text. The author argues also about the inconsistencies of the exchange rate policy and the contrationary monetary policy of high interest rate.
Economic policies and stabilization in the Real Plan
The purpose of this article is to sketch a simple framework of analysis of the macroeconomic performance of the Brazilian economy. We show that the exchange policy of the Real Plan was completely right, in contradiction to many annalists who have always pointed its inadequacy. The weakness of the Real Plan must be search in the fiscal policy, which was highly inconsistent. Finally, the monetary policy can be seen as a great disaster. The reason was that with the extremely high interest rates the public debt increased enormously.
The exchange rate policy of the Real Plan
The main objective of this work is to analyze the arguments in favor and against the exchange rate policy followed in Brazil since 1994 and to question the suitability of this policy to the Brazilian case. The arguments based upon either productivity gains, public deficit or calculations of PPP are not sufficient to justify the continue use of the fixed exchange rate regime. Theoretically the best policy to attain the internal and external balance is to devalue the local currency and to the increase interest rate. This procedure does not mean a free floating exchange rate regime.
The negative effects of exchange rate policy on Brazilian agriculture
This paper gauges upon the cost paid by the Brazilian agricultural sector due to the exchange rate policy followed during the period 1989/97. The appreciation of the exchange rate during that period, particularly during the Real Plan, originates a considerable decrease in prices received by the producers. Despite this fact, total production increased modestly and the reduction in the per capita production was not significant. Increases in international prices of primary products during 1994/97, reductions in the prices of inputs used in the agricultural sector and considerable improvements in land productivity helped the agricultural sector to overcome the cost imposed by the overvaluation of the exchange rate during the period.
Current account balance and the real exchange rate: the Brazilian case in the last two decades
This paper focus on the existence of a long-term equilibrium between real exchange rate and current account balance. It applies a structural model to understand the relationship among the movements of current account deficit, real exchange rate, national income and world trade. Thus, it will be possible to test for a long-run relation among these variables movements as well as the short-term disequilibrium effects on the current account deficit. The empirical part of this paper applies the Johansen procedure with the objective to find cointegration relations among the variables mentioned. This analysis will permit to separate long- run relation from short-term dynamics in such a way as to permit to understand the impact of shocks on the equilibrium relation among the variables.
Through empirical and theoretical evidences, this article identifies and appraises four relevant policy mistakes incurred during the Real Plan. The first mistake was the common belief that strong currency means strong economy; the second, because of the inflationary memory of the recent past, was the fear that devaluation of the exchange rate would be translated fully into price increases; the third error asserts that, in a globalized world, the existence of sufficient foreign savings would finance any level of current account deficit; the fourth misjudgment asserts that the increase of the overall productivity of the Brazilian economy could be pursued by the overvaluation of the exchange rate and by the expanding insertion of the multinational corporations. Those mistakes contributed to increase the foreign constraints, historically the main restraint to Brazilian development.
Produção internacional e redes globais: uma resenha
The objective ofthis paper is to develop an updated bibliography review with regards to the process of internationalization of production, listing the main explanation for Transnational Corporations (ETs) international production, and focusing in the recent movement of the intensification of this process, where global production networks have a main role.
international production and global production networks
Copyright (c) 2005 Economia Aplicada http://creativecommons.org/licenses/by-nc/4.0
As fontes de mudança da eficiência técnica da indústria brasileira após a liberalização comercial: uma estimação econométrica por dados de plantas
This paper presents empirical evidence about the effects of trade liberalization on the evolution of the technical efficiency ofthe Brazilian manufacturing plants. A. panel data regression model is applied to estimate the changes in labor productivity and real average costs at the plant-level between 1988 and 1994, and between 1994 and 1998. The methodology, originally proposed by James Tybout and Daniel Westbrook (1995), was modified to allow more consistent responses to a central question of the academic debate in Brazil throughout the 1990's, that is, which ofthe following potential sources played the main role in productivity gains in the Brazilian manufacturing sector after trade liberalization: i) a cut in employment (employment effect); ii) output-share reallocations among plants within each industry (marketshare effect); or iii) technical innovations, access to foreign equipment through imports, positive economic externalities, among other factors not observed by the researcher (residual effects)? This paper represents an attempt to provide consistent answers to the above questions in the case of recent Brazilian experience. It provides evidence that the first effect prevailed over the others in explaining the technical efficiency gains ofthe Brazilian manufacturing sector throughout the 1990's.
Estimação da matriz insumo-produto a partir de dados preliminares das contas nacionais
The goal ofthis study is to present and to analyze a methodology to estimate Input-Output Matrices using preliminary data from the Brazilian National Accounts. This methodology is tested for the years of 1994 and 1996, where the results obtained from the input-output matrices (definitive version) available from IBGE are compared with the matrices estimated using the proposed methodology. The results analyzed refer to: a) type I production multipliers; b) Rasmussen-Hirschman backward and forward linkages; and c) Pure backward and forward linkages. Based on statistical methods (correlation indexes), the results show that the estimated matrices are similar to the ones released by IBGE. As so, this methodology can be used to estimate Brazilian national input-output matrices for the time periods where there are only preliminary data, and the economic structural analysis made with the estimated matrices are valid for the years analyzed.
Interactive profit maximization modeling for poultry production: a decision model application to soybean and cottonseed meal
Profitability of substituting cottonseed meal (CSM) for soybean meal (SBM) in broiler feed is evaluated using a model that optimizes broiler production and processing under changing market conditions. The profit maximization model therefore incorporates feed formulation, broiler production, and broiler processing to determine what feedstuffs yield the heaviest birds to be processed at the lowest cost and for the most profitable processed parts. The optimal solution is determined for scenarios where there are two processing options: whole carcass vs. cut-up parts. For the case-study prices analyzed, CSM-fed broilers may earn higher profits for whole carcass processing, while SBM-fed broilers earn higher returns for cutup parts processing. Price mapping analysis indicates that for given fluctuations ofCSM and SBM prices, using CSM in cut-up parts processing can also be profitable.
Ajustes nos mercados de álcool e gasolina entre os anos de 1995 e 2000
The aim ofthis study was analyze and characterize the fuel markets — gasoline and anhydrous ethanol, relating the changes effects in associated variables to supply and demand about the agents' behavior in a market partly deregulated, that is, between 1995 and 2000. The model was made up of five equations, being one of gasoline C to retailing and four of fuel prices. The mainly conclusions were: the demand variations tended to be met without major changes in the price of gasoline and its compounds; the wholesale gasoline C and gasoline A at refineries prices adjustments, even moderated, were reposed partly to retailing; the government had a tendency to absorve the external shocks of prices and did not repose immediately to retailing and the retailing did not repose, at the same extent, to the final consumer. The research results reflected sectors still operating under State domain, which controlled their operations without necessarily meeting the economic logic.
Produção de camarão marinho em cativeiro: uma análise de eficiência técnica, alocativa e de custos
The objective of this study was to analyze the technical, allocative and costs efficiency ofshrimp aquaculture by using data envelopment analysis technique. The results showed that 38 shrimp farmers are technically efficient and 30 are inefficient, requiring to reduce the use of inputs by 19,11%. Measures of allocative efficiency and of costs suggested a reduction in the inefficiency of combination of the inputs use and productive costs to maximize profit. The optimum combination ofthe inputs would reduce by 37,13% the operational cost of the inefficient ones. It was concluded that bad combination of the inputs is not allowing to maximize profit, in spite ofthe enormous profitability ofthe sector.
Efeito Fisher, incerteza e aversão ao risco uma análise empírica para o Brasil
This paper aims to estimate a Fisher relation embedded with uncertainty for Brazil during the period Jan/75 - Sept/2000. So far the empirical literature for the Brazilian economy only considered a simple one-toone relation between expected inflation and nominal interest rates, which means that agents were risk neutral and any kind of uncertainty was simply "added" to the error term. In the model we consider agents incorporate this risk premium in the nominal rate through the covariance between the inflation rate and consumption growth. Our estimates show that the risk premium is high for hyperinflationary periods, which implies a weaker Fisher effect. Moreover agents have a high risk aversion coefficient in these periods compared to more stable ones.
A taxa de juros de equilíbrio: uma abordagem múltipla
The purpose of this paper is to estimate the equilibrium real interest rate for Brazil using different approaches, in order to incorporate all the available information on the topic. The methods used are: historical interest rates, structural models, a long-run growth model, and through the exchange rate. For all these methods, the estimated equilibrium rates for Brazil were high relative to those found for the rest of the world. Also, a panel with 13 countries was estimated to examine the relationship between interest rates and the sovereign risk premium. A sub-panel of Latin-American countries was also examined.
Measuring trust: an experiment in Brazil
Attitudinal measures of trust, such as those employed by the World Values Survey (WVS) or the General Social Survey (GSS), have been shown to be correlated with important country-level variables reflecting economic and institutional development. However, Glaeser, Laibson, Scheinkman and Soutter (Quarterly Journal of Economics, 2000) have found that those attitudinal measures poorly correlate with behavioral measures of trust obtained from an experimental "trust game" involving monetary incentives. We replicate Glaeser's et al. study using Brazilian subjects and performing the experiment under two conditions: when individuals meet face-to-face prior to their interaction, and when they cannot do so. We find that the effect of attitudinal measures of trust (such as the WVS/GSS scale) on subjects' trusting behavior in experimental transactions appears to be significantly larger when they cannot meet face-to-face (a condition that was not employed in Glaeser's et al. study). Echoing Glaeser's et al. results, we also find that attitudinal measures of trust are significantly correlated with rustworthy behavior: individuals who affirm to be more trusting are apparently less inclined to act opportunistically. Thus, evaluating attitudinal measures of trust within appropriate experimental conditions, we find that measures such as the WVS/GSS scale appear to have a role in explaining both trusting and trustworthy behavior.
Erros, omissão e os proprietários do conceito de credibilidade
Sobre a mensuração da credibilidade das metas para inflação
Expectativas inflacionárias e índices de credibilidade nas metas de inflação: quando o formalismo esconde fraquezas e erros
Método de obtenção da matriz de insumo-produto do Paraná para o ano de 2000
This article presents the 2000 input-output (TO) accounts for the Parana state economy and the methodological procedure used. Initially it considers the activities and products classification. Next introduce the location quotient method, used to fit technical coefficients of the national matrix. Data source were the national and regional accounts published by IBGE (Brazilian Institute of Geography and Statistics), and fiscal data of the Finance Bureau of Parana. Finally, it describes and presents for the economy of Paraná, the following tables: Make table: industries producing commodities; Use table: commodities used by industries and final uses; The commodity-by-industry direct requirements table; Market Share table; The industry-by-industry direct requirements table; Leontief matrix.
Paridades das taxas de câmbio (FX) nos mercados emergentes
This paper aims to test the purchasing power parity (PPP) in emerging markets by using the recent cointegrated panel technique. The relative version of the purchasing power theory is tested for a group of countries, which composes the EMBI Global Index. Our sample is composed of 22 developing countries: Argentina, Brazil, Mexico, Venezuela, Ecuador, Peru, Colombia, Chile, South Korea, Philippines, Malaysia, China, Thailand, Russia, Poland, Bulgaria, Greece, Turkey Hungary, Croatia, Morocco and South Africa. For testing the strong version of the PPFJ we have considered the between-dimension FMOLS (Fully Modified OLS) according to Pedroni (2001). This estimator permits more flexibility relatively to the homogeneity ofthe cointegration vector in the alternative hypothesis ofthe test. Our results have rejected the PPP.
Determinantes da taxa de câmbio real, teoria e evidencias empíricas: uma aplicação para o Brasil
We test for the Brazilian economy three theories for the determination of the real exchange rate: 1. The theory of the Purchase Power Parity (PPP) relative, which implies constant real exchange rate; 2. The hypothesis of the relative variation of the productivity, which asserts that the increase of the productivity differential between producer sector of traded goods and the producer sector of no traded goods of a country regarding other countries carries to the real valorization ofthe exchange rate; 3. The transfers effect, which affirms that the income transfers abroad generate real devaluation of the exchange rate, and the transfers receipt generates valorization. The results carried to the rejection of PPP relative and to the confirmation of the importance of the relative variation of the productivity and of the transfers effect in the determination of the real exchange rate of Brazil. The rejection of PPP relative implies do not there be a constant balance rate, to the which the exchange rate always would return. And the importance of the relative variation ofthe productivity and ofthe transfers effect makes the rate ofreal exchange rate be subject the flotations certain for real variables, like the relative productivity abroad and the net external passive.
A análise dos regimes de taxa de câmbio para o Mercosul baseada no bem-estar
This paper analyzes the Mercosur s exchange arrangement toward a welfare-based approach. Therefore it was used an open-economy macroeconomic dynamic general equilibrium model that incorporates three economies with nominal rigidities and imperfect competition in product and factors markets. The main conclusion points out to the adequate exchange arrangement for economic bloc is Argentine and Brazil should fix each other their local currencies and set free fluctuation in relationship with the remainder international economies.
The spatial pattern of crime in Minas Gerais: an exploratory analysis
This paper is aimed at examining spatial pattern of crime in the state otMinas Gerais, Brazil. In methodological terms, this paper uses exploratory spatial data analysis (ESDA) to study the distribution of crime rates in more than 750 municipalities of this state for 1995. The findings reveal that crime rates are distributed non-randomly, suggesting positive spatial autocorrelation. Moreover, spatial heterogeneity represented by both the positive local spatial association (spatial regimes of HH and LL municipalities) and the negative local spatial association (spatial regimes of HL and LH municipalities) is identified. Only one spatial outlier ofHH type is detected, but it does not have any influential impact on the level ofspatial autocorrelation, measured by the Moran s 1. Furthermore, a simple spatial regimes model with inertial effects, but without any causal covariates, has an explanatory power of about 70% of the variation in the crime data. In this regard, the inertial effect is a very relevant aspect ofthe crime in Minas Gerais. The pattern ofspatial distribution revealed through ESDA provides an empirical and solid foundation for the further econometric specification ofmultivariate models.
exploratory spatial data analysis (ESDA)
Analyzing the use of generalized hyperbolic distributions to value at risk calculations
The goal of this paper is to analyze the use of the Generalized Hyperbolic (GH) Distributions to model the US Dollar/Brazilian Real exchange rate in a way to produce more accurate VaR (Value at Risk) measurements. After the GH parameters estimation, several distances were calculated to verify the fitting quality of Normal distribution and GH distribution family to empirical data. The GH Distributions had shown to be more adequate for modeling the US Dollar/Brazilian Real exchange rate, since they produced smaller distances, especially in tails. Additionally, several methodologies for VaR calculation were compared using the Kupiec test: Historical Simulation, RiskMetrics®, unconditional Normal, GH, Normal Inverse Gaussian (NIG) and Hyperbolic, and GARCH models using Normal, GH, Hyperbolic and NIG. The GH Distribution and its subclasses showed better results than unconditional Normal. The use of a GARCH model for volatility forecasting produced satisfactory results, being the main factor of success. Two estimation methods were used: Maximum Log-Likelihood and Minimization of the FOF distance; but both produced similar results. As the Maximum Log-Likelihood showed to be faster we recommend this method. Overall, our recommendation the use of a GH family distribution re-scaled by a GARCH volatility and estimated by Maximum Log-Likelihood.
Os impactos ambientais industriais da alca no Brasil
This study is an attempt to estimate the industrial environmental impacts due to FTAA in Brazil. Based on these CGE model results from Tourinho and Kume (2002), we estimate the resulting changes of pollution emission and water and energy use levels in the Brazilian industrial sector due to FTAA. Our results are very interesting since economy-aggregate direct environmental impacts of FTAA on the Brazilian economy are expected to be, in general, very minor and in the direction of a lower air pollution intensity (paniculate and SO2) and energy uses. Flowever, it is expected an increasing intensity in water pollution and uses and CO2 emissions. These changes will occur in few sectors where already exist dynamic technological and environmental policies and motivation to meet export market stricter environmental rules.
Copyright (c) 2004 Economia Aplicada http://creativecommons.org/licenses/by-nc/4.0
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