Preço da terra, taxa de juro e acumulação financeira no Brasil
Cláudio Antonio G. Egler
The relationships between the land price and the financial system in Brazil has been analyzed under different points of view, but little or none significance is given to the interest rate as a factor that underlies the land market with the financial accumu-lation. The main purpose of this work is to analyse, in a historical perspective, how the land price expresses different stages of development of the financial activities and how the interest rate makes a bridge between land and capital markets.
Vol.5, n.o1(17), 1985
Uma avaliação das contribuições de Stiglitz à teoria dos mercados financeiros
Dante Mendes Aldrighi
An evaluation of Stiglitz’s Contributions to the Theory of the Financial Markets. The objective and originality of this paper lie in identifying Stiglitz’s main theoretical contributions to Financial Economics and in briefly portraying the contemporary economic thought out of which these contributions emerged as well as in suggesting their connections with the subsequent economic thought. Grounded on a detailed analysis of Stiglitz’s works on finance, his most important theoretical findings are singled out and gathered into four issues: (1) the conditions under which the Modigliani-Miller theorem is valid; (2) the inconsistency inherent to the efficient market hypothesis; (3) the microeconomic effects of asymmetrical information in financial markets; and (4) its real macroeconomic effects. In all of these topics, the focal point of Stiglitz’s theoretical research is the unrealistic underpinnings on which the Arrow-Debreu competitive equilibrium model relies. It is also emphasised that this same perspective he coherently followed to construct a fully-fledged theoretical framework would be preserved in his empirical investigations, notably about developing countries, on which he has concentrated effort since the beginnings of the nineties.
Vol.26, n.o1(101), 2006
A new consensus on monetary policy?
Edwin Le Heron
By analyzing the documents issued by the Bank of Canada, an original monetary policy can be seen. The Canadian monetary policy tries to maintain its autonomy, whilst at the same time respecting floating exchange rates. The numerous innovations are the foundation of a New Consensus on monetary policy. Far from the dilemma rule versus discretion of the former Monetarist and Keynesian methods, a new dilemma will be the focus: that of credibility versus confidence. Here, the anticipations of the economic agents, the behavior of financial markets and the price of assets play a dominating role. Based on the innovative experiment of the Bank of Canada during the 1990s, the characteristics of the New Consensus will be explained. Far from making independent central banks some high-powered institutions, it shows them instead to be ‘statues with feet of clay’.
Vol.23, n.o4(92), 2003
A crise do sistema financeiro globalizado contemporâneo
Ernani Teixeira Torres Filho

The paper analyses the development of the contemporary global financial system as a consequence of markets as well as States strategies. This global financial system based on the flexible dollar has generated many financial bubbles since it started in the 80´s, of which the 2008 crisis is the latest and the largest, particularly because it affected the main banks in the core market of the system, the US. On the last decades, banks had changed their business strategies from traditional lending activities towards more speculative investments, similar to what hedge funds do.

Vol.34, n.o3(136), 2014
Emerging markets and the international financial architecture: a blueprint for reform
Jan Kregel

 If emerging markets are to achieve their objective of joining the ranks of industrialized, developed countries, they must use their economic and political influence to support radical change in the international financial system. This working paper recommends John Maynard Keynes’s “clearing union” as a blueprint for reform of the international financial architecture that could address emerging market grievances more effectively than current approaches. Keynes’s proposal for the postwar international system sought to remedy some of the same problems currently facing emerging market economies. It was based on the idea that financial stability was predicated on a balance between imports and exports over time, with any divergence from balance providing automatic financing of the debit countries by the creditor countries via a global clearinghouse or settlement system for trade and payments on current account. This eliminated national currency payments for imports and exports; countries received credits or debits in a notional unit of account fixed to national currency. Since the unit of account could not be traded, bought, or sold, it would not be an international reserve currency. The credits with the clearinghouse could only be used to offset debits by buying imports, and if not used for this purpose they would eventually be extinguished; hence the burden of adjustment would be shared equally—credit generated by surpluses would have to be used to buy imports from the countries with debit balances. Emerging market economies could improve upon current schemes for regionally governed financial institutions by using this proposal as a template for the creation of regional clearing unions using a notional unit of account.

Vol.35, n.o2(139), 2015
The Global Crisis and the Implications for Developing Countries and the BRICs: Is the "B" reality justified?
Jan Kregel
Developing countries experienced high growth and low inflation in the new Millennium. This has been due in part to the impact of the expansion in developed country financial markets on demand for exports. Especially positive has been the performance of the so-called BRICs - Brazil, Russia, India and China. The collapse of the financial markets will eliminate the positive impact of export-led growth. An alternative strategy will be required. One possibility is to build on domestic sources of demand. Brazil is well-placed to engage in such a strategy and already has a number of policies to support this alternative. They should be introduced rapidly.
Vol.29, n.o4(116), 2009
As finanças internacionais e o estado nos países capitalistas avançados e nos menos desenvolvidos
Jeff Frieden
The international financial boom of the past 20 years presents features that, especially in comparison with past experience, have given rise to a number of analytical confusions. The first is that contemporary international finance is above or beyond the nation state; yet the form of today’s Euromarkets is due largely to the impact of state policy, and the markets hold together largely because of the implicit or explicit presence of the major states — especially the principal guarantor of the system, the United States. The second major error is to see Third World debt either as evidence of the success of developing countries’ inexorable march toward full economic autonomy, or as evidence of their total loss of economic independence. In fact, foreign borrowing has strengthed the hand of the domestic states and of the elites that support it and are supported by it, providing funds essential for the constitution of an integrated national economy. At the same time, however, this borrowing can place major constraints on the debtor country, especially in periods of economic troubles. Contemporary international finance thus rests on strong support from the advanced capitalist countries’ nation-states — a support which is now clearly aroding — and upon an implicit partnership between lending banks and borrowing countries — a partnership now being strained to the breaking point by increasingly onerous demands their creditors are making on the heavily indebted developing countries.
Vol.3, n.o4(12), 1983
Alternative approaches to financial crises in emerging markets
Jeffrey Sachs
Este texto analisa a ocorrência de crises nos mercados financeiros das economias chamadas emergentes. Na seção 2 analisam-se os fatores que podem levar à ocorrência de crises financeiras nesses mercados, bem como sugerem-se algumas medidas macroeconômicas ou arranjos institucionais que poderiam evitá-las ou minimizá-las. Na seção 3 discute-se o papel de organismos internacionais, principalmente do FMI, com relação à prevenção e resolução dessas crises.
Vol.16, n.o2(62), 1996
O modelo de racionamento de crédito e a política monetária novo-keynesiana: uma análise crítica
Jennifer Hermann
The paper discusses and criticizes the credit rationing model (CRM) and its use to support the new-Keynesian approach to the monetary policy. After analyzing the working of the model in the different phases of the business cycle it is concluded that: (i) in the upward phase, demand rationing equilibrium — which is a condition for recommendation of counter-cyclical monetary policy in the CRM scope — is not plau-sible as a macroeconomic phenomenon, but only at microeconomic level; (ii) in the downward phase, although the demand rationing is a plausible equilibrium, it does not occur for the reason alleged by the CRM (the rigidity of the interest rate), neither it does act in favour of the transmission mechanism of monetary policy. These con-clusions imply the rejection of the CRM as theoretical basis for monetary policy analy-sis, as well as of the new-Keynesian approach about this theme. Finally, it is argued that, at macroeconomic level, the unique theoretical contribution of the CRM is to justify “vertical” interventions of government in financial markets, through financ-ing policies to sectors or projects which risks are more difficult to estimate — nota-bly, in infra-structure, R&D and new-technology sectors.
Vol.20, n.o2(78), 2000
Bancos públicos em sistemas financeiros maduros: perspectivas teóricas e desafios para os países em desenvolvimento
Jennifer Hermann
The paper discusses two theoretical approaches to the role of public banks (PBs): the Shaw-McKinnon model and an alternative Keynesian view. In the former, the PBs still in operation in less developing countries would be near to become fully unnecessary, in view of the advance of their financial development in the last twenty years. In the Keynesian approach this hypothesis is unlikely. Financial markets are viewed as structurally inefficient and “incomplete” for the requirements of the process of economic development. Nevertheless, it is undeniable that economic and financial development will require a definition of new strategies for PBs. The paper is concluded with a brief discussion of this issue.
Vol.31, n.o3(123), 2011
Financial markets, external shocks and policy responses: the case of Brazil 2001
Lauro Vieira de Faria
This paper evaluates the macroeconomic response of the Brazilian government in 2001 following the emergence of sharp negative events in both the external and internal sectors with particular focus on monetary and exchange rate policies. It points out that the kind of macroeconomic reaction depicted by the standard Mundell-Fleming model is of little practical importance in a small open economy engulfed in dollar denominated debts and experiencing a confidence crisis like Brazil’s. The Brazilian economy operates as if there were some sorts of ceilings for the exchange rate and for interest rates, in a clear departure from the assumptions embodied in the “pure” model. In this kind of environment another set of actions is required to fight a dangerous exchange rate overshooting and that is proven by the events of 2001. Whilst the actions taken by the monetary authorities proved successful at that moment the paper shows that they came with sizeable real and financial costs as collateral. Therefore, the paper argues in favour of another set of macroeconomic responses which should have been preferred if we were to avoid such costs.
Vol.23, n.o4(92), 2003
Fluxos de capitais, fragilidade externa e regimes cambiais: uma revisão teórica
Luciano F. Gabriel e José Luis Oreiro
Capital Flows, External Fragility and Currency Regimes: A Theoretical Review. The major integration and deregulation of the international financial markets increased the degree of interdependence and risk of incompatibility between the financial and monetary policy adopted by different countries. The consequences of these facts are the financial instability and the currency crisis. In this article we develop arguments advocating that independent of the currency regime adopted the national policy makers should take into account, between other factors, the major capital mobility and the integrations of markets. One of the corollaries of our analyses is that countries should pursue policies that reduces the degree of short-term capital volatile by the adoption of capital controls or though measures of prudential supervision.
Vol.28, n.o2(110), 2008
Auge e declínio da hipótese dos mercados eficientes
Luiz Antônio de Oliveria Lima
Eugene Fama defines a market as efficient if it fully reflects the existing information about the fundamental values of a financial asset. According to this hypothesis this kind of market makes available to the agents the optimal options for investing their money, leading in consequence to an efficient allocation of capital. The aim of this article is to show that this condition in fact does not exist in economic reality and as consequence to discuss how the alternative forms of asset markets guide the process of investment. The alternative forms of allocation imply that economic agents do not follow the ideal model of “full rationality”, but that they follow one “weak form” consistent with decisions that must be taken in condition of uncertainty. This analysis will allow us to construct more realistic models of financial markets considering not only their conditions of normality as well as the circumstances that explain their instability and crises.
Vol.23, n.o4(92), 2003
Incompetência e confindence building por trás de 20 anos de quase estagnação da América Latina
Luiz Carlos Bresser-Pereira
Latin America remained almost stagnant in per capita terms in the last twenty years. The original causes are well known: the interrelated debt crisis and the fiscal crisis of the state. But why Latin American countries took so long to recover macroeconomic stability? Not only because fiscal adjustment and market oriented reforms were checked by interest groups, but also because, even when policymakers were free from political constraints, they nevertheless often made serious policy mistakes – mistakes that derived from technical or emotional incompetence, and from a subordinate “confidence building” strategy, that implied doing everything they supposed international agencies and financial markets would expect in order to achieve credit and credibility, instead of using their own judgment to make decisions and design required reforms.
Vol.21, n.o1(81), 2001
The 2008 financial crisis and neoclassical economics
Luiz Carlos Bresser-Pereira
The 2008 global financial crisis was the consequence of the process of financialization, or the creation of massive fictitious financial wealth, that began in the 1980s, and of the hegemony of a reactionary ideology, namely, neoliberalism, based on self-regulated and efficient markets. Although capitalism is intrinsically unstable, the lessons from the stock-market crash of 1929 and the Great Depression of the 1930s were transformed into theories and institutions or regulations that led to the “30 glorious years of capitalism” (1948–77) and that could have avoided a financial crisis as profound as the present one. It did not because a coalition of rentiers and “financists” achieved hegemony and, while deregulating the existing financial operations, refused to regulate the financial innovations that made these markets even more risky. Neoclassical economics played the role of a meta-ideology as it legitimized, mathematically and “scientifically”, neoliberal ideology and deregulation. From this crisis a new capitalism will emerge, though its character is difficult to predict. It will not be financialized but the tendencies present in the 30 glorious years toward global and knowledge-based capitalism, where professionals will have more say than rentier capitalists, as well as the tendency to improve democracy by making it more social and participative, will be resumed.
Vol.30, n.o1(117), 2010
Leilões de títulos da dívida pública pelo Banco Central do Brasil: um estudo dos fatores condicionantes da dispersão das propostas para os BBCs
Márcio G. P. Garcia e Leonardo B. Rezende
We aim at obtaining a simple econometric model that allows us to build a confidence interval for the dispersion of the bids made by financial institutions at the central bank weekly auctions of short term securities in Brazil. Under competitive conditions (e. g., no coalition between a few financial institutions) we assume that the bid's dispersion is associated with the volatility of the daily interest rate futures prices and the daily interest rates that had prevailed during the days prior to the auction. Based on that assumption, our model succeeds in separating the two auctions with extremely high volatility. In one of them, the high dispersion could be predicted using the other interest rate markets' data; in the other the dispersion fell outside the confidence interval for the predicted dispersion. This can be used as empirical evidence of an attempt to corner the market that has indeed ocurred at that date.
Vol.20, n.o4(80), 2000
O crash de 2002: da "Exuberância irracional" à "ganância infecciosa"
Maryse Farhi e Marcos Antonio Macedo Cintra
This paper is an attempt to discuss the macroeconomic repercussions from de-inflating a speculative bubble in stock markets and from an established low price trend. Revelations accrued this low price trend how comprise recommendations by financial analysts, corporation balance sheets, auditing companies and credit rating agencies make the asset pricing difficult, affect confidence by financial agents and contaminate their expectations. The crisis of confidence brought about by these revelations can potentially impact on economic growth of developed countries, beginning with the USA, raise risk aversion by investors and trigger reinforced regulation and supervision mechanisms in detriment to auto-regulating ones which had been prevailing up to the present moment.
Vol.23, n.o1(89), 2003
A arquitetura do sistema financeiro internacional contemporâneo
Maryse Farhi e Marcos Antonio Macedo Cintra
The architecture of the current international financial system. This paper discusses some features of financial institutions and instruments which originated the financial crisis triggered by increasing default rate, household real estate and financial asset depreciation combined with U.S. subprime mortgages. The first part presents major crisis events in a chronological order. The second part describes the interconnection of the institutions and markets which engendered a global shadow financial system. The third part focuses on an overview of measures taken by government authorities and large banks to bring about possible solutions for the global financial crisis.
Vol.29, n.o3(115), 2009
Convivendo com o câmbio Flutuante
Maryse Farhi e Marcos Antonio Mecedo Cintra
Since the implementation of a floating exchange system by the Brazilian economic authorities in mid-1999, the trajectory of the real exchange rate has been characterized by extreme volatility, inherent in such a system. The Brazilian financial market, how-ever, has the advantage to possess a reasonably liquid derivative market which can contribute to a less turbulent ‘relationship’ with a floating exchange regime. Never-theless, any possible benefits from this market to the Brazilian economy would re-quire: the routine use of financial derivatives by economic agents in their business management, the elimination of any restriction to access to derivative markets by foreign investors, and the improvement of supervisory and regulatory mechanisms.
Vol.20, n.o3(79), 2000
Liquidity vs. efficiency in liberalized international financial markets: a warning to developing economies
Paul Davidson
Until 1973 the postwar international payments system was, in large measure, shaped by Keynes’s thesis that flexible exchange rates and free international capital mobility are incompatible with global full employment and rapid economic growth in an era of multilateral free trade (Felix, 1977-8). This resulted in a stable interna-tional monetary system that permitted the global economy to experience unparalleled economic growth and prosperity despite widespread capital controls and international financial market regulations. Since 1973, the financial system has grown progressively more fragile with recurrent and increasingly stressful international debt and currency liquidity crises threatening the stability of the global economy.
Vol.20, n.o3(79), 2000
"Globalização" financeira e regimes cambiais
Paulo Nogueira Batista Jr.
This paper argues that, although international capital flows have increased rapidly in recent decades, financial markets are still far from forming an unified global market. It also argues that the effect of increasing capital mobility on national economic policy autonomy continues to depend, to a large extent, on the choice of the exchange rate regime.
Vol.18, n.o2(70), 1998
Dolarizações e heterodoxia na américa latina
Pierre Salama
Changes in the international financial markets implied new conditions for the financing of the Latin American foreign debts. The “dolarização” of these economies, both in the broad sense (using the dollar rather than the local currency) and strict (capital flight) sense, acquired new im-portance, intensely affecting the monetary sovereignty of these countries. As a result, new eco-nomic policies were instituted in Argentina and Brazil aimed at reducing inflation by imposing a price freeze and a general de-indexation of the economy without causing a recession as well as at maintaining a minimal servicing of their external debts. The author takes into account the external context as well as both the economic structures and the accumulation of capital, which vary depen-ding on the country and moment, as he analyzes the limitations of the measures used to slowdown the long-term “dolarização” and the main features of the “Austral” and “Cruzado” plans, which were presented as heterodox. Lastly he presents the possible need to adopt measures that are more heterodox than those foreseen in those plans: success would be a result of a partial moratorium of the payment of the foreign debts and a sensible modification of the distribution of income.
Vol.7, n.o3(27), 1987
Inovações financeiras e institucionais do sistema de financiamento residencial americano
Rafael Fagundes Cagnin
Institutional and financial innovations in the U.S. housing finance system. This article has the gold of summarize the institutional modifications of the US housing finance system between the 60´s and the end of the 90´s. Those changes narrowed the bonds between this segment of the credit market and the securitized financial markets, encouraging the foundation and diffusion of financial innovations that are in the core of the current financial crises.
Vol.29, n.o3(115), 2009
Dívida externa e alternativas de desenvolvimento na américa latina
Ricardo Ffrench-Davis
The document proposes that the origin of the foreign debt problem faced by developing countries be found in the way international capital markets work. A mistaken optimistic view concerning financial market’s behaviour in the 70’ might extend for many years, since debtor nations have adapted their economic structures to a great amount of external funds; on the contrary, a shortage of funds is expected in this decade’s last years. These tendencies will deeply mark social and economic performances of most countries in this region. Some of the main options that these nations will be forced to face are analyzed in this text. Apart from the imperative need to fight for a change in the way foreign debt has been renegotiated, it is also necessary to reorganize their external economic policies. This occurs through the intensification of economic cooperation among debtor nations and through initiating a new phase of import’s substitution now being coordinated by means of import’s expansion. Some facts responsible for a better capacity of handling and adjusting different countries according to the economic strategies they have adopted in the past and to the political situation each country has to face are also demonstrated here.
Vol.5, n.o3(19), 1985
The great latin america debt crisis: a decade of asymmetric adjustment
Robert Devlin e Ricardo Ffrench-Davis
Latin America has entered a new phase of abundance of capital inflows, bearing some resemblance to the episode of 70s. In this paper a review is made of the origins of indebtedment in the 70s, of the emergence of the crisis in the early 80s, and of the management by creditors and debtors during that decade. Some lessons are derived about the working of international financial markets and policy implications.
Vol.15, n.o3(59), 1995
Deuda externa, crescimento y sostenabilidad
Roberto Frenkel
The paper presents a model intended to define and discuss the sustainability of external debts in “emergent markets.” The first sustainability condition is the existence of a maximum in the debt-output ratio. With some simple behavior hypotheses it is shown that sustainability depends on the initial debt-exports ratio, the rate of growth of exports and the country-risk premium. An endogenous country-risk premium gives room for multiple equilibrium. The model allows the discussion of vulnerability vis-à-vis financial shocks and the propensity of the economy to jump to unsustainable paths. The first sustainability condition is not a stringent one. Two additional sustainability conditions are added: a positive rate of growth and a minimum in the domestic absorption-output ratio. The discussion of multiple equilibrium, vulnerability and the potential instability of sustainability is then extended.
Vol.24, n.o2(94), 2004
O sistema financeiro e o financiamento do crescimento: uma alternativa pós-keynesiana a visão convencional
Rogério Studart
Financial liberalization models have been for the last nineteen years the foundation of mainstream thinking on the role of financial markets and institutions in economic development and the basis for policy-making in many LDCs. This paper presents a critical appraisal of the financial liberalization literature and points to a alternative view based on Post Keynesian theory. That alternative view is bas-ed on three aspects of monetary economics. First savings does not provide finance: the role of savings is not related to the financing of capital accumulation, but to its funding. Second, capital accumulation increases banks’ fragility, which can be alleviated through funding. Finally, how we model the finance-investment-saving-funding circuit depends on institutions and conventions, which are evolving.
Vol.13, n.o1(49), 1993
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