The Political Economy of Productivity in Brazil
This paper explores the link between Brazil's political institutions and its disappointing productivity and growth in recent decades. Although political institutions provide the president with incentives and the instruments to pursue monetary stability and fiscal discipline they simultaneously raise the costs of achieving those very objectives. The insulation of certain expenditures from presidential discretion necessitates the use of other policy options, such as high taxation levels and cuts in unprotected expenditures, which put a drag on productivity and growth. In a context of robust checks and balances and interest group fragmentation, a state overburdened by constitutional entitlements has resorted to massive increases in taxation. The resulting environment possesses both essential elements for sustainable economic growth and distortions that conspire against its realization. While some improvements in productivity and growth have occurred in the past decade, the pace has been slow and incremental.
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| Format: | Working Papers biblioteca |
| Language: | English |
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Inter-American Development Bank
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| Subjects: | Productivity, O25 - Industrial Policy, O43 - Institutions and Growth, IDB-WP-104, |
| Online Access: | http://dx.doi.org/10.18235/0010738 https://publications.iadb.org/en/political-economy-productivity-brazil |
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dig-bid-node-97992024-05-30T20:21:26ZThe Political Economy of Productivity in Brazil 2010-03-15T00:00:00+0000 http://dx.doi.org/10.18235/0010738 https://publications.iadb.org/en/political-economy-productivity-brazil Inter-American Development Bank Productivity O25 - Industrial Policy O43 - Institutions and Growth IDB-WP-104 This paper explores the link between Brazil's political institutions and its disappointing productivity and growth in recent decades. Although political institutions provide the president with incentives and the instruments to pursue monetary stability and fiscal discipline they simultaneously raise the costs of achieving those very objectives. The insulation of certain expenditures from presidential discretion necessitates the use of other policy options, such as high taxation levels and cuts in unprotected expenditures, which put a drag on productivity and growth. In a context of robust checks and balances and interest group fragmentation, a state overburdened by constitutional entitlements has resorted to massive increases in taxation. The resulting environment possesses both essential elements for sustainable economic growth and distortions that conspire against its realization. While some improvements in productivity and growth have occurred in the past decade, the pace has been slow and incremental. Inter-American Development Bank Lee J. Alston Bernardo Mueller Marcus André Melo Carlos Pereira Working Papers application/pdf IDB Publications Brazil en |
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biblioteca |
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America del Norte |
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Biblioteca Felipe Herrera del BID |
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Productivity O25 - Industrial Policy O43 - Institutions and Growth IDB-WP-104 Productivity O25 - Industrial Policy O43 - Institutions and Growth IDB-WP-104 |
| spellingShingle |
Productivity O25 - Industrial Policy O43 - Institutions and Growth IDB-WP-104 Productivity O25 - Industrial Policy O43 - Institutions and Growth IDB-WP-104 Inter-American Development Bank The Political Economy of Productivity in Brazil |
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This paper explores the link between Brazil's political institutions and its disappointing productivity and growth in recent decades. Although political institutions provide the president with incentives and the instruments to pursue monetary stability and fiscal discipline they simultaneously raise the costs of achieving those very objectives. The insulation of certain expenditures from presidential discretion necessitates the use of other policy options, such as high taxation levels and cuts in unprotected expenditures, which put a drag on productivity and growth. In a context of robust checks and balances and interest group fragmentation, a state overburdened by constitutional entitlements has resorted to massive increases in taxation. The resulting environment possesses both essential elements for sustainable economic growth and distortions that conspire against its realization. While some improvements in productivity and growth have occurred in the past decade, the pace has been slow and incremental. |
| author2 |
Lee J. Alston |
| author_facet |
Lee J. Alston Inter-American Development Bank |
| format |
Working Papers |
| topic_facet |
Productivity O25 - Industrial Policy O43 - Institutions and Growth IDB-WP-104 |
| author |
Inter-American Development Bank |
| author_sort |
Inter-American Development Bank |
| title |
The Political Economy of Productivity in Brazil |
| title_short |
The Political Economy of Productivity in Brazil |
| title_full |
The Political Economy of Productivity in Brazil |
| title_fullStr |
The Political Economy of Productivity in Brazil |
| title_full_unstemmed |
The Political Economy of Productivity in Brazil |
| title_sort |
political economy of productivity in brazil |
| publisher |
Inter-American Development Bank |
| url |
http://dx.doi.org/10.18235/0010738 https://publications.iadb.org/en/political-economy-productivity-brazil |
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AT interamericandevelopmentbank thepoliticaleconomyofproductivityinbrazil AT interamericandevelopmentbank politicaleconomyofproductivityinbrazil |
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