Credibility and populism: the economic policy of the Goulart administrations in Brazil
DOI:
https://doi.org/10.1590/1980-53574234smpfKeywords:
populism, credibility, Brazil, João GoulartAbstract
The Goulart Administrations (1961-1964), which consisted of a parliamentary period and a presidential period, are considered typical examples of populism in Brazil. The literature usually defines economic policies advanced by these administrations as "hesitating", "irrational" or "ambiguous". We use a credibility model to argue that there is actually a consistent pattern in the manner in which economic policy was conducted. The credibility of the economic policies is defined to be the subjective probability that the government is following a monetary rule. Early on, the administrations enacted inflation-fighting measures. However, these policies were costly, and the administrations abandoned the course of austerity. As a result, their credibility was diminished, and attempts to achieve stabilization failed.
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