About the conference
Main currents in Brazilian socio-economic development
Historically, changes in the orientation and the scope of the Brazilian government interventions have been associated with deep economic and social transformations. In the 1960s and 1970s, the economic outcomes were decisively affected by militarism that turned out to reinforce economic growth with social exclusion. It also led to increasing productive internationalization where key agents have been the transnational corporations from many developed countries. However, the so-called Brazilian model of development led to further concentration of income, wealth, and land ownership. As Celso Furtado pointed out, it was a false modernization as it benefited only a minority reinforcing the structural heterogeneity and inequality. After the 1970s, questions have been raised about the pattern of Brazilian industrialization that led to failed expectations. Those millions of Brazilians that had hoped for a fair and sustainable economy and society were disappointed by stagnant incomes and higher inflation.
Since the 1990s, Brazil has been subject to a new dependency where financial capital tends to dominate social and economic dynamics in a historical setting where the redefinition of the elites is part of the overall financialization process. Consequently, as of the early 2000s, Brazil has been considered as a promising emerging economy by global institutions and investors. From 2000 to 2008, the expansion of the BRICS – Brazil, Russia, India, China and South Africa—benefited from the combined commodity and credit cycle. During this period, Brazil experienced high rates of economic growth and was able to promote the inclusion of large portions of the population in the financial, labor and goods markets. As a result, the economy has experienced near full employment during the two years prior to the financial crisis. Income inequality dropped and inflation was kept under control. Interest rates trended downward. However, external imbalances grew and the manufacturing share of output declined while exports have been mainly driven by commodities. In this setting, the newly discovered underwater oil reserves are a major opportunity and challenge: whereas they can provide funds for investing in education and health services, they also raise the prospect of a possible Dutch disease.
Following the global crisis, Brazil has been seriously affected by the decline of commodity prices. In the last decade, Brazil did not improve key structural features of its economy leading to a sustainable business environment. The lack of long-term investments in infrastructure, for example, is part of the scenario that dampens the expectations around the sustainability of economic growth and social inclusion. As of 2012, only 1.5% of Brazil’s GDP goes on infrastructure investment from all sources, both public and private. To catch up, Brazil would have to triple its annual infrastructure spending for the next 20 years (The Economist, 28th September 2013)
In the aftermath of the global crisis, government intervention have supported aggregate demand and supported social inclusion. However, there are signs that the speed of the consumption and investment growth has been diminishing in a scenario characterized by inflation pressures, lower expectations of bank profitability and a diminishing rate of job creation, among other issues. Considering the global economic integration, Inflationary pressures have put on pressure on domestic interest rates which attract “hot money” from international “carry-trade” operators and finance. Indeed, this attraction turns out to be considered necessary by the Brazilian government in order to address the trade deficit but renders the economy vulnerable to sudden changes in investor sentiment.
In this context, the long term sustainability of development, growth and social cohesion is called into question.
About the papers
This conference focuses on various aspects of inclusive and sustainable growth from the broader perspective of examining their interlinkages with other economic, social, and political processes. Concerns with social inclusion extend well beyond issues of justice and fairness, since the degree of economic inequality also affects social cohesion and political stability, and can also have negative implications for economic growth and sustainability. The broad themes covered are noted below. Papers falling within the broad topic of the conference though on aspects not explicitly noted here were also welcome. We welcomed contributions from Brazilian and non-Brazilian economists, sociologists and political scientists.
1. Economic growth and development
Main drivers of Brazilian development and growth; Structural change and manufacturing; Economic and social implications of agribusiness;The South-South relations and the impacts on economic growth; Building the human and technical infrastructure: changes in education, training and in technology; Productivity and growth; The role of foreign transnational corporations; Foreign direct investment and trade during development; The role of Brazilian transnationals; The role of the State in Brazilian development
2. Problems and challenges associated with Brazilian development
Industrial output in the context of globalization; Balance of payments constraints; The challenges of transnationalization; The rise of China and its implications on the structure and performance of the Brazilian economy; Challenges to Brazilian enterprises in the context of capital globalization
Income and wealth distribution; Main drivers of wealth concentration; The rise of rentier incomes; Fiscal policy and inequality; Gender inequality ; Generational inequality; Policies to lower inequality; Patterns of regional and local inequality
4. The role of finance
Global finance and the implementation of macroeconomic policy; Banking dynamics; Challenges to the development of capital markets;The policy of financial inclusion; Credit cycles and bubbles; Rentier interests, finance, and monetary policy
5. Wage, employment, and social policies
Main patterns of job creation; Sectoral composition of employment creation and destruction; Gender challenges in the labor market; Educational challenges, employment and wages; Labor market flexibilization: social and economic impact; The role and scope of social and wage policies; Social policies and poverty; Migration trends; Labor organization and distributive conflicts: the evolution of Trade Unions in Brazil;The changing nature of social classes in Brazil
6. Inclusion and sustainability: major challenges for Brazil
Inclusion and exclusion drivers in the Brazilian pattern of development: economic, social and political inclusion; Regional distribution; Physical sustainability: issues of resources, transport and pollution; Social sustainability; Political sustainability in the context of current social and economic problems; Sustainability of current welfare policies;Regional inclusivity
7. The global crisis and the Brazilian economy
The impacts of the crisis on the Brazilian Economy; Policy responses to the crisis; Public banks after the global crisis;Recovering from the crisis: the Brazilian and international experiences compared