A inflação (brasileira) segundo Marx
Alberto Passos Guimarães

It is not the prices that vary in accordance with the amount of money in circulation; it is rather the amount of money in circulation that varies in accordance with the variation of the sum of prices. It is not the risting of the earnings that causes the rising of the prices. On the contrary, it is the rising of the prices, producing deprecations in the currency that provokes in consequence losses of the earnings’ acquisitive power. When increases of the sum of prices occur, whatever their origins, we will have one of the following inevitable consequences: on the one hand, the same quantity of commodities is then exchanged by a larger amount of money; on the other hand, the same amount of money then buys a smaller quantity of commodities. This happens in the internal trading relations as well as in the international trading relations of each country. In both cases, the main fact to point out is the reduction of the money’s acquisitive power. This reduction can be produced eighter spontaneously, by the action of the forces of the market, or as a result — as in the case of the alterations of the rate of exchange — of the intervention of the Government authority. Therefore, according to Marx, contrary to the different theories supported by the “vulgar economy”, the inflationary phenomenon begins with the currency depre-ciation, of which are consequences or subsequences, the price increases and the reduc-tion of the earnings’ acquisitive power. The Brazilian inflation in the ‘70s and ‘80s was seriously aggravated by the world’s cyclical crisis, by the capital’s overproduction in the rich countries, by imports of surplus capital through banking loans, and by the monetary anarchy which displac-ed the investments of the productive sectors, deviating them to the non-productive sectors.

Vol.4, n.o4(16), 1984
Aceleração inflacionária, instabilidade financeira e endividamento interno e externo
Alexandre Schwartsman

We provide here a model that attempts to explain how the financial circuit in Brazil became an outstanding locus of wealth valuation. It shows that its special character is due to a peculiar institutional arrangement that allows the public sector — the main financial agent — to operate with negative spread. Then, inflationary shocks can produce very strong movements of private sector portfolio, between indexed and non-indexed bonds, which can deepen the negative spread. This is the reason why the financial circuit is a source of wealth valuation, since this negative spread is appropri-ated by the financial speculators.

Vol.12, n.o4(48), 1992
O Brasil num cruzamento: dívida externa e exaustão fiscal
Álvaro Antônio Zini Jr.

The debt crisis caused a major setback in Brazil’s economic development in the 1980s. Stabilization policies based on contracting aggregate demand have produced an overall stagnant economic performance that alternates periods of recession with periods of growth cum rampant inflation. The attempts of adjustment have implied a near exhaustion of the public sector finances and have added distortions in the pattern of financing the economy. While the “transfer problem can be potentially settled on the real side, on the fiscal side obstacles are real and may indeed lead to stagnation in the 1990s. This paper suggests a concerted action to promote growth; one that involves a stimulus to the production of tradeables through an investments policy and a new approach to commercial and the exchange rate policies, and a refunding of the domestic and the external debts of the public sector to help solve the financial disarray of the Government.

Vol.10, n.o1(37), 1990
Conservadorismo e Rigidez na Política Monetária: uma estimativa da função de reação do BCB (2000-2007)
André de Melo Modenesi

This paper aims at evaluating the conduction of monetary policy after the adoption of inflation targeting. Formation of Selic rate is modeled by estimating a reaction function of the BCB. Results show an excessive degree of interest rate smoothing and a high level of equilibrium interest rate. This evidence supports the belief that Selic rate’s formation is ruled by a conservative behavior. The conservative conduction of monetary policy is related to two distinct features of BCB’s reaction function: i) the great weight of autoregressive components; and, chiefly, ii) a very high level of the equilibrium interest rate. The main conclusion is that, all remaining unchanged, the interest rate would hardly be reduced in a satisfactory way. Massive and chronic deflation would be needed if Selic were to reach a reasonable level, closer to that of rates in the rest of the world. This evidences the need for a debate on the adequacy of current stabilization strategy.

Vol.31, n.o3(123), 2011
Da inflação crônica à hiperinflação: observações sobre o quadro atual
André Lara Resende

This article makes a classification of inflation processes. Moderate inflation is a phenomenon represented by Phillip’s Curve. In chronic inflation, inertial and back-ward looking indexation are major factors. Hyperinflation eliminates backward looking indexation and is dominated by expectation and the public factor financial difficulties. It is argued that although the public inflation factor deficit is not always the primary cause of chronic inflation, in later stages no government deficit what-soever can be financed. The lack of all sources of public factor financing is what characterizes the transition to hyperinflation. The current Brazilian scene is analyzed.

Vol.9, n.o1(33), 1989
As armadilhas do tripé da política macroeconômica brasileira
(The traps of the tripad of the Brazilian macroeconomic policy)
André Nassif

Este artigo analisa o chamado tripé da política macroeconômica brasileira, que desde 1999 tem combinado um regime de metas de inflação, um regime de taxa de câmbio flutuante e metas de superávit fiscal primário. A menos que o seu modus operandi seja alterado, o tripé não será capaz de libertar a economia brasileira de outra “possível trindade”: altas taxas de juros reais, a apreciação da taxa de câmbio real e crescimento econômico muito baixo. Depois de analisar brevemente a base teórica sob o tripé macroeconômico, o artigo mostra por que este regime de política macroeconômica, se avaliado numa perspectiva de longo ou médio prazo, não tem sido capaz de garantir a estabilidade dos preços nem o crescimento econômico. Além da sugestão de romper com a estratégia brasileira de crescer com poupança externa, o documento também sugere três principais formas de mudar o modus operandi do tripé brasileiro: i) aumentar o horizonte de tempo para atingir a meta de inflação, como tem sido o experiência da maioria dos países que adotam esse regime de política monetária; ii) restaurar o papel anticíclico da política fiscal brasileira; e iii) adotar uma combinação de mecanismos que visem prevenir que a moeda brasileira entre em uma nova tendência cíclica da apreciação em termos reais. 

This paper analyses the so-called tripod of the Brazilian macroeconomic policy, which since 1999 has been combining an inflation target regime, a floating exchange rate regime and targets for primary fiscal surplus. I argue that, unless its modus operandi is changed, the tripod will not be able to free the Brazilian economy from another “possible trinity”: high real interest rates, real exchange rate appreciation and very low economic growth. After briefly analysing the theoretical base under the macroeconomic tripod, I will show why this macroeconomic policy regime, if it is evaluated in a medium or long-term perspective, has not been able to assure neither price stability nor economic growth. In addition to the suggestion of breaking with the Brazilian strategy of growing with foreign savings, the paper also suggests three main ways of changing the modus operandi of the Brazilian tripod: i) increase the time horizon for reaching the inflation target, as has been the experience of most countries that adopt this monetary policy regime; ii) restore the countercyclical role of the Brazilian fiscal policy; and iii) adopt a mix of instruments aiming at preventing the Brazilian currency from entering into a new cyclical trend of appreciation in real terms.

Vol.35, n.o3(140), 2015
Macroeconomic trouble and policy challenges in the wake of the financial bust
Angel Asensio

Contrasting with the 1929 great crisis, authorities intervened forcefully in 2008 to stop the disintegration of the financial system. Governments and central banks then sought to revise the prudential regulation in depth. It would be optimistic, however, to believe that prudential measures, alone, could deliver full economic recovery, at least in the countries that had been involved in the financial turmoil. Indeed, the collapse of the 'state of confidence' and the negative effects of private debts on consumption and investment decisions have fed depressive forces and policy challenges which could hold for a while, even once the financial sector is made safe. On the one hand, the economic slowdown and the direct and indirect assistance provided by the governments to the private sectors are having a heavy impact on public finances, meanwhile, on the other hand, the massive amounts of money which artificially inflated the prices of housing and financial products could produce inflationary pressures in the post-crisis period, unless a new assets bubble is allowed for. Authorities could therefore be facing high unemployment in a damaged context of public deficits and inflationary pressures. The paper aims at discussing these new challenges. The inadequacy of inflation targets and fiscal orthodoxy in a depressed economy is emphasized, and the outlines of a Post Keynesian alternative policy are examined.

Vol.31, n.o2(122), 2011
A reestruturação industrial brasileira nos anos 90. Uma interpretação
Antonio Barros de Castro

The Brazilian industry has been deeply changed during the nineties although it is not easy to have a synthetic and encompassing view of the transformation occurred. In order to have such a view one have to take into account the heavy influence of the years of high inflation (until mid 1994). Stabilization and overvaluation (of the real) in the years following the launching of the Real Plan were another decisive influence. The article argues that submitted to this set of conditioning events, industry in Brazil went through a (limited) catch up during the nineties. It also tries to show how progress has been mainly concentrated at the plant level – both in multinational and in domestic industrial firms.

Vol.21, n.o3(83), 2001
Distribuição de renda no Brasil nos anos 80
Antônio Corrêa de Lacerda

Contrary to the huge development of the Brazilian economy from the post-war to the end of the seventies, the eighties signified the rupture of this cycle and the combination of a chronic inflationary process, the economic stagnation and the worsening of income inequality. These factors together has not revealed to be neutral concerning the distributive aspect. Between 1981 and 1989, the income of the 10 per cent richer increased 14,2 per cent, while the income of the 20 per cent poorer decreased 26 per cent. This work presents some international comparisons, even on the fuctional as well as on the personal distribution of income, and concludes that this distribution becomes a fundamental aspect the stabilization and to the economic-social development recovering.

Vol.14, n.o3(55), 1994
Problemas de controle monetário no Brasil
Armínio Fraga Neto

The control of monetary aggregates in Brazil has to face three large problems: 1) high govern-ment budget deficit, 2) the ineffectiveness of the interest rate as a policy instrument in a highinflation environment; 3) unpredictable financial innovation. The first two problems are especially important when one is trying to design stabilization programs. After inflation reaches a certain le-vel, standard monetary policies become, powerless. Control of the budget deficit (i.e. a limitation on the use of the inflation tax) becomes necessary condition for stabilization.

Vol.8, n.o1(29), 1988
A "credibilidade" da política econômica antiinflacionária e sua consistência temporal
Arthur Barrionuevo Filho

This article is a survey about the consequences of the credibility of government policies, one of the main developments in macroeconomic theory in the 80s. New classical economists used it to explain why, in the long-run, government policies fail when they intend to increase the level of employment above the natural rate. Even in the short run, they only achieve their aims if it is possible to cheat the private sector. The result will be to loose credibility and inflationary pressures. Other authors developed it as a tool to understand the relationship between government, political parties and pressure groups with economic policy. Finally, we comment some papers about the Brazilian inflation based on distributive conflict and compare them with explanations from credibility of policies.

Vol.14, n.o1(53), 1994
O processo orçamentário: tendências e perspectivas
Carlos Alberto Longo

The budget bill spells out the key functions of government. Once passed into law, its implementation assures the provision of public services, the minimization of social injustice, and the search for full employment with inflation under control. This article begins by outlining the historical origins of national budgeting, stressing the evolution and systematization of the process as nations develop. Brazil’s budget legislation is described starting with the 1969 constitution. Moving on to the 1988 constitution (in force), the prolixity and inconsistency of the chapter on public finance are criticized. The Brazilian budgetary process is shown to be excessively fragmented, with three separate but overlapping pieces of legislation — the Budget Guidelines Act (Lei de Diretriz Orçamentária), the Federal General Budget and the Multiyear Plan. It is concluded that efficacy and transparency could be enhanced by merging all three into a single act.

Vol.14, n.o2(54), 1994
O desequilíbrio do setor público brasileiro: cenários alternativos
Carlos Alberto Primo Braga, John H. Welch e Paulo de Tarso Afonso de André

The Brazilian public sector disequilibrium, as measured by growth in the global net public sector debt to GDP ratio, is examined with and without the “Piano Cruzado”. Two models are used, one based upon a discrete time framework and the other based upon a continuous time framework, to trace paths of the debt-GDP radio for the rest of the decade concentrating on the 1985-1990 period. Two major conclusions are reached. The first, of a theoretical nature, is that discrete time models are inappropriate in an inflationary context as they severely underestimate the inflation tax. The second is that the Plano Cruzado may put strong pressure on government finances due to the drastic fall in the inflation tax.

Vol.7, n.o3(27), 1987
Observações sobre o processo inflacionário brasileiro: 1986-1991
Carlos Antonio Luque

The aim of this essay isto examine the 1986-91 Brazilian inflationary process. This essay wiIl take the broadest analytical une, considering the inflationary process resulting from the evolutionary dynamics of the elements that affect the aggregate supply and demand. Regarding the aggregate demand shifts we emphasize the relationships between fiscal and monetary policies. We stresscd that the impact of public sector deficit has been seen much more as a financing problem rather than the result of its leveis. Regarding costs we emphasize the role of the relative price of competitive sectors that are more important in determining real wages and those of the oligopolistic sector. Our study seems to suggest that the causes of Brazilian inflationary process are many and com plex and their solution do not depend solely upon the squeeze of the public sector deficit.

Vol.13, n.o2(50), 1993
A lei de responsabilidade na gestão fiscal: combatendo falhas de governo à brasileira
(The law of fiscal management responsibility: Combating government failures in the Brazilian way)
Carlos Antonio Luque e Vera Martins da Silva

O objetivo deste artigo é analisar os principais aspectos do novo regulamento, a chamada “Lei de Responsabilidade na Gestão Fiscal”, utilizando a estrutura do desequilíbrio orçamentário como uma falha do governo. Ressaltamos que o princípio da nova regulamentação é que, se o planejamento do governo for altamente detalhado e o déficit estiver sob controle, não observaremos inflação nem pressões de endividamento. Existem dois grandes problemas de controle: limites para despesas com salários de pessoal e o montante da dívida. O novo regulamento restringe a ação pública durante o último ano do mandato e trata da importância de divulgar informações sobre questões fiscais e a participação do público nas práticas orçamentárias. Apesar dos bons aspectos da regulamentação – especialmente no último ano dos gastos de um determinado governo, ainda há alguns problemas: a falta de discussão sobre o tamanho adequado e as funções do governo e o componente anticíclico da ação governamental que é desprezado pela lei. 

The purpose of this article is analyzing the principal aspects of the new regulation, the so-called “ Lei de Responsabilidade na Gestão Fiscal” using the framework of the budget imbalance as a government failure. We pointed out that the principle of the new regulation is that if the government planning is highly detailed and the deficit is under control, we will observe neither inflation nor debt pressures. There are two great issues of control: limits to expenditures with personnel’s salaries and the amount of debt. The new regulation restrains the public action during the last year of mandate and deals with the importance of spreading information on fiscal issues and the public participation on the budgetary practices. Despite the good aspects of the regulation – especially on the last year of a given government’s expenditures, there are still some problems: the lack of discussion on the adequate size and functions of the government and the anti-cyclical component of the government action which is despised by the law..

Vol.24, n.o3(95), 2004
Uma nota sobre o impacto da estabilização no comércio internacional
Carlos Henrique Rocha e Eraldo Sérgio Barbosa

This note presents a situation in which the government surprises rational agents by implementing an antiinflation policy in place of one that fights against recession. As a result, a pressure towards the balance of payments superavit is obtained during the impact period. That conclusion stems from the surprise of the new government policy under a “leaning against the wind” policy regime.

Vol.15, n.o4(60), 1995
A regulamentação dos preços dos planos individuais de saúde
Carlos Octávio Ocké-Reis e Simone de Souza Cardoso

Pricing regulation of Brazilian private health insurance. Aggregate price indices measure variations in nominal prices. In this paper, we compare the inflation rates of the general economy and those of the health sector and private health insurance market between 2001 and 2005, based on the indices of Departamento Intersindical de Estatística e Estudos Socioeconômicos, of Fundação Instituto de Pesquisas Econômicas, of Instituto Brasileiro de Geografia e Estatística and IPEADATA database, to the private heath insurance readjustment applied by the National Private Health Insurance Agency (ANS). The health sector inflation rate was found stable and inferior to the general one, what would validate applying lower readjustments derived from official price indices.

Vol.31, n.o3(123), 2011
Grau de organização da economia e desempenho macroeconômico
César Costa Alves de Mattos

This article discusses the question of the relationship between the degree of centralization of the price-decision-making process of economic agents and the inflation rate. There are compared in a theoretical model, the conventional wisdom that postulates a positive relationship between the two variables, the so-called “neo-corporativist” vision that puts exactly the opposite conclusions, and an alternative conciliating the other two that will be our principal focus. We will also analyse the behavior of organizations in the economy based on the Olson work, taking some interesting implications to the model. It’s put in perspective the question of the Brazilian union organization based on the model.

Vol.14, n.o3(55), 1994
Política de estabilização e abertura externa: uma análise comparativa das experiências do Chile, da Argentina e do México
Cláudio Gontijo

This article examines Chile’s 1976-81, Argentina’s 1987-92, and Mexico’s 1982-92 stabilization experiences. In these three cases high inflation was curbed after orthodox stabilization policies with liberal structural reforms had been followed by using a fixed exchange rate as an “anchor” for the price level. It suggests the existence of a trade off between internal and external equilibria. Orthodox stabilization policies can be very successful in equilibrating the balance-of-payment without producing price level stability. In contrast, curbing high inflation may require fixing the exchange rate, which, combined with trade liberalization, may produce huge commercial deficits.

Vol.15, n.o1(57), 1995
Governos autoritários e câmbio nos países latino-americanos
Cláudio Ribeiro Lucinda e Paulo Roberto Arvate

Authoritarian governments and exchange rate policy in Latin American countries. Our aim on this paper is to identify the exchange rate policies used by Authoritarian governments in Latin America during the seventies and eighties. The literature shows that the focus of the exchange rate policy was on inflation control, which was not consistent with the evidence. We show on this paper that these governments aimed at a undervalued currency because of the behavior of the external balance of the countries.

Vol.26, n.o3(103), 2006
Sistema financeiro de habitação: a questão do desequilíbrio do FCVS
Clovis de Faro

The Brazilian Financial Housing System is on the verge of virtual insolvency. The conti-nued presence of inflation, coupled with an inconsistent system of debt indexation (the so-cal-led monetary correction), further aggravated both by a plethora of concessions given to the borrowers and by some ill-conceived procedures that were imposed by a sequence of stabiliza-tion plans (Cruzado, Summer and Collor) has resulted in a potential imbalance of USS 20 bil-lions for the Fundo de Compensação de Variações Saláriais — FVCS (Compensation Fund of Wage Variations). Discussing the basic inconsistency of the debt indexation scheme that is still being used, the paper points out the origin of the problem and offers some suggestions on how it could be reduced.

Vol.11, n.o1(41), 1991
A constituição, os juros e a economia
Clovis de Faro

The promulgation of the Brazilian Constitution of 1988, reinstated the so called Usury Law. According to this old regulament, which was never revoked but that was made ineffective due to the extremely high rates of inflation that we have been experiencing since a long time ago, the rate of interest, in nominal terms, cannot exceed 12% yearly. Aiming to innovate, while at the same time ignoring the ever present law of supply and demand, the 1988 Constitution established that ceiling in real terms. The paper focuses not only on the difficulties of measuring the effective rate of interest that is charged on bank loans, but also on the almost impossible task of measuring it in real terms. The unavoidable conclusion is that this new version of the Usury Law will be also rendered ineffective in practice.

Vol.14, n.o1(53), 1994
Populismo ou endogeneidade orçamentária? política fiscal discricionária na argentina
Daniel G. Arce M.

This paper uses the Fischer equation and Olivera-Tanzi effect to insulate the inflationary endogeneity existing in Argentine public deficit. The outcome is a fiscal policy discretionary measure known as zero inflation budget. Through this measure we examine if the deficits reflects countercyclical policies or populist consumption targets.

Vol.15, n.o4(60), 1995
A teoria da "não-universalidade" da teoria econômica
Décio Garcia Munhoz

To accept that the postulate of the Economic Theory has validity in any country is to suppose the universality to the theory. The examination of the process of cost formation in the productive system and of the income sources shows that the imposition of new cost components in the economy brings movements for income accommodation, through acceleration of inflation up to a new equilibrium level. However, the new equili-brium rate will depend of three factors: the share of the new cost components in the GDP; the participation of the contractual income, like wages, in the GDP; and the periodicity of the contractual income correction. These factors are differents from country to country, refusing the validity of monetary theory supposition. This article shows that it is possible to conclude on “non universality” of the Economic Theory. At last, if is correct to admit that larger the share of contractual incomes in the GDP more stable will be the economy, then the income policy would be a strategic factor for the stabilization policy when the economy is subject to costs shocks.

Vol.5, n.o1(17), 1985
A armadilha do controle dos preços públicos: o exemplo dos insumos energéticos
Décio Katsushigue Kadota e Carlos Roberto Azzoni

The paper argues that in controlling public prices government gets into a trap: this control does not reduce inflation as expect in the first moment and activates factors that will increase it later on. The analysis is developed for government administered prices in the area of energy and employs an input-output model that takes into account the direct and indirect impacts of price changes. When public prices are reduced, the impact on the inflation is small; but, since this create financial difficulties for the public companies, they will either demand government resources and/or price appreciation later on. These will act through price expectations to increase inflation more than proportionally in the future.

Vol.16, n.o2(62), 1996
Rethinking macroeconomic policies for development
Deepak Nayyar

The global economic crisis has created an opportunity to rethink macroeconomics for development. Such rethinking is both necessary and desirable. It is essential to redefine macroeconomic objectives so that the emphasis is on fostering employment creation and supporting economic growth instead of the focus on price stability alone. It is just as important to rethink macroeconomic policies which cannot simply be used for the management of inflation and the elimination of macroeconomic imbalances, since fiscal and monetary policies are powerful and versatile instruments in the pursuit of development objectives. In doing so, it is essential to the overcome the constraints embedded in orthodox economic thinking and recognize the constraints implicit in the politics of ideology and interests.

Vol.31, n.o3(123), 2011
O fisco e a inflação: uma interpretação do caso brasileiro
Edmar Lisboa Bacha

Available “fundamentalist” interpretations of Brazilian inflation seem unable to explain why Brazil has such high rate of inflation with such a small public sector operational deficit. An attempt is made to explain this paradox with the use of the concepts of potential deficit with zero inflation and the inflationary erosion of budgeted government expenses. The conclusion is that the resolution of the Brazilian inflationary conflict involves the transfer, to local governments or the private sector, of a significant share of the current functions of the federal government.

Vol.14, n.o1(53), 1994
Reflexões pós-cepalinas sobre inflação e crise externa
Edmar Lisboa Bacha

The UN/ECLA 1949 Manifesto centered on inflation and balance of payments as critical issues on Latin America’s development. Fifty years afterwards, Latin America succeeded both conceptually and in practice to overcome the high inflation syndrome. Not so the external strangulation, which is still very much present in the region. After reviewing recent conceptual advances in understanding the “dollar constraint” problem, the paper discusses Persio Arida’s proposal for a fully convertible floating currency as a means of building a domestic long-term financial market.

Vol.23, n.o3(91), 2003
Bacen e BCs selecionados: uma análise comparativa do nível de transparência
(Bacen and ed Central Banks: comparative analysis of the transparency degree)
Eduardo de Carvalho Andrade

Este artigo compara o grau de transparência do Banco Central do Brasil (Bacen) com o verificado em outros Bancos Centrais (BCs) selecionados. Seguindo a metodologia desenvolvida em Hann e Eijffinger (2000), construímos um indicador de transparência baseado em: (i) quão claros os BCs estão com relação a seus objetivos de política monetária, e (ii) como os BCs são transparentes na implementação de sua política monetária. O Bacen tornou-se mais transparente após a adoção do regime de metas para a inflação em 1999. No entanto, esses procedimentos mais transparentes não fazem parte da lei que regulamenta o Bacen, indicando que eles podem ser facilmente substituídos. 

This paper compares the degree of transparency of the Brazilian Central Bank (Bacen) with the one verified in other ed Central Banks (CBs). Following the methodology developed in Hann and Eijffinger (2000), we constructed an indicator for transparency based on: (i) how clear the CBs are with respect to their monetary policy objectives, and (ii) how transparent the CBs implement their monetary policy. The Bacen has become more transparent after adopting the inflation targeting regime in 1999. However, these more transparent procedures are not part of the law that regulates the Bacen, indicating that they can be easily replaced..

Vol.24, n.o3(95), 2004
O choque argentino e o dilema brasileiro
Eduardo Marco Modiano

The application of the so-called “heterodox shock” anti-inflation policy in Argentina provoked several discussions about the similarities and differences between Brazilian and argentine inflation, and the possibility of its application in Brazil. This article attempts to examine some of these questions. The analysis emphasizes the question of the lags in the readjustment of the prices and the contribution of the conversion of prices to the average values of the period for the stability of the new currency; the question of the synchronization of wages and prices increases; and the utilization of conversion tables. Finally, the rate of interests and its relation with the level of economic activity.

Vol.6, n.o2(22), 1986
Uma análise estruturalista da inflação e da estabilização
Edward J. Amadeo e José Márcio Camargo

This paper develops a model in which the distributive conflict between capital and labor is the driving force, which generates inflationary pressures in a market economy. In the model the rate of inflation is a function of the capacity of firms to pass increases in costs to prices and of the relative power of workers and employees associations in the process of collective bargaining. One of the main results of this analytical framework is that the structure of the capital/labor relations in a country, the process of collective bargaining and the structure of unions organizations are important determinants of inflationary pressures. As a result, institutional reforms which promote cooperation on capital/labor relations are of great importance in stabilization policies, if the social costs of stabilization are to be minimized.

Vol.12, n.o4(48), 1992
Alan Greenspan, the confidence strategy
Edwin Le Heron

To evaluate the Greenspan era, we nevertheless need to address three questions: Is his success due to talent or just luck? Does he have a system of monetary policy or is he himself the system? What will be his legacy? Greenspan was certainly lucky, but he was also clairvoyant. Above all, he has developed a profoundly original monetary policy. His confidence strategy is clearly opposed to the credibility strategy developed in central banks and the academic milieu after 1980, but also inflation targeting, which today constitutes the mainstream monetary policy regime. The question of his legacy seems more nuanced. However, Greenspan will remain ‘for a considerable period of time’ a highly heterodox and original central banker. His political vision, his perception of an uncertain world, his pragmatism and his openness form the structure of a powerful alternative system, the confidence strategy, which will leave its mark on the history of monetary policy.

Vol.26, n.o4(104), 2006
Política de estabilização mexicana: 1982-1989
Elena Landau

The paper analyses economic policy measures related to the 1982-89 Mexican stabiliza-tion plan. It shows that the first phase was predominantly orthodox. In a second step, a dein-dexation policy was followed, which kept prices and wages virtually constant during approxi-mately two years. The results so far have been significant reduction of inflation rates, the main cost being a loss of foreign exchange reserves and a substantial decrease of real wages. The Mexican stabilization experiment is usually presented as a successful case of adjustment to the external sector crisis and inflation reduction. A decisive test of the program, however, will take place when prices and wages were liberalized.

Vol.11, n.o4(44), 1991
Hiperinflação na america latina
Eliana A. Cardoso

This paper discusses why inflation is so high in Latin America and what can be done to stop it. The first part starts with an analysis of monetarism. It also discusses seignorage models, the impact of the debt crisis and of dollarization on inflation. Next we review structuralism and its most recent insight: inflation inertia. Then we integrate the different interpretations of inflation. The second part examines stabilization programs, beginning with the analysis of programs derived from the monetarist diagnose, or orthodox programs. Next we turn to heterodox programs, including both populist programs and programs based on a new interpretation of inflation. The stabilization programs of the 1980s failed to obtain budget consolidation and large budget deficits have pushed the economy into a classic inflationary finance situation.

Vol.9, n.o3(35), 1989
O processo inflacionário no Brasil e suas relações com o déficit e a dívida do setor público
Eliana A. Cardoso

This paper offers an interpretation of the Brazilian inflation and comments briefly on the Cru-zado Plan. It emphasizes two points. First there are the problems of fiscal consolidation iii the pre-sence of a large public debt. What is missed iii many analyses of stabilization programs is precisely the particular debt situation, and the role of foreign exchange availability in successful versus non-successful programs. Secondly we discuss the role of budget deficits in the inflationary process in Brazil. Seignorage models as an explanation for inflation in Brazil are dismissed on the grounds that seignorage as a share of GDP shows absolutely no correlation with inflation. The money-goods model of monetarism is inappropriate to the Brazilian economy because it predicts that seignorage drives the system. But the Brazilian experience on the contrary has to be interpreted iii the light of changing sources of financing the budget. The inflation acceleration between 1979 and 1985 is lin-ked to the switch from external to domestic finance, and the large trade surpluses that pushed up interest rates and inflation. The paper develops a model that shows a pattern of adjustment for in-creasing inflation induced by increasing equilibrium real interest rates, that matches the Brazilian data. The Cruzado Plan failed to pay attention to the debt problem and the need for budget conso-lidation (probably through debt relief and a capital levy). In the absence of an integrated approach it pushed the economy into a classic inflationary finance situation.

Vol.8, n.o2(30), 1988
Cyclical variations of earnings inequality in Brazil
Eliana Cardoso

This paper shows that income distribution can change dramatically during the business cycle. This finding contrasts with the widespread belief that income distribu-tion changes slowly in the absence of wars and revolutions. Macroeconomics explains in good measure short-run variations in income distribution: inequality varies cycli-cally and it increases with inflation and unemployment. Furthermore, at least in Brazil, the minimum wage legislation does not contribute to a better income distribution. There is also evidence that populist policies which lead to real appreciation cannot be justified as supporting the poor. Thus, the best way to help the poor is demonstrably not through the manipulation of prices and wages, but probably through macro stability and a transparent tax-transfer system.

Vol.13, n.o4(52), 1993
A crise monetária no Brasil: migrando da âncora cambial para o regime flexível
Eliana Cardoso

The author begins by asking why Brazilian policymakers opted to target the exchange rate to stabilize inflation when this strategy had already failed in Mexico. The answer: it was no longer possible to accommodate the contry's high inflation rate through the pervasive use of price indexation and a competitive exchange rate policy. Under conditions of high inflation, the anchoring of the exchange rate within the Real Plan was the quickest route toward price stability. However, policy success also required deep fiscal adjustment, and traditional Brazilian politics stubbornly resisted the necessary tax reforms. In contrast to Mexico, where the peso crash was fueled by reckless private sector spending and borrowing, Brasil's January 1999 devaluation was triggered by chronically high fiscal deficits. Brazil's rapid recovery under a flexible currency regime suggests that the macroeconomic fundamentals are back on track; the challenge now lies in the crafting of a viable pro-reform political coalition that can cut through the numerous parochial interests that converged to provoke the 1999 devaluation.

Vol.21, n.o3(83), 2001
Orçamento e planejamento municipal: um estudo de caso
Eloi Dalla Vecchia e Marco Antonio Montoya

The present article searches to evaluate the efficiency of planning in the municipal area, within the period of 1989 to 1997, aiming to establish if, the variable inflation determine higher or lower levels considering the municipal adjusting. For this, it was used as data base the budget of 67 municipal districts of the Medium Plateau region of the state of Rio Grande do Sul. The methodological process implied the construction of efficient indexes, evaluated through the adjust grade of the budget variable. It was verified that: a) the variable inflation is not the only determining of the municipal planning adjusting; b) It exists, in the municipal technical staff, lack and deficiency about the planning and the discipline (technical) budget; c) The absence of a formal and established process that could evaluate the budget proposals, in the discussion and approval of the laws, considering this a legislative responsibility. Therefore, is concluded that the legislators, mainly in the period of price establishment, were not efficient considering the exercise of their jobs, judgment, discussion and approval of the budget laws in the cities of the Medium Plateau Region of the state of Rio Grande do Sul, since they permitted the systematic superevaluation budget, which proposed the generation of a series of deficits.

Vol.22, n.o2(86), 2002
Uma nota sobre o aumento do gasto com pessoal da União
Fábio Giambiagi

This paper shows the increase of the expenditures related to the Brazilian federal government payroll and the payment of retired people previously employed by the federal government. This variable suffered a jump of around 2.5 points of the GDP between 1985 and 1995. It is also shown the evolution of the aggregate value and the composition of this kind of expenditure according to the different government agencies (including ministries). It is concluded that this process is difficult to reverse in the short term, especially in an economy with a low level of inflation.

Vol.16, n.o3(63), 1996
Salários, inflação e conflito distributivo: reflexões acerca da escala móvel
Fábio Giambiagi

This article tries to show some of the potential problems that appear with the adoption of the automatic mechanism of wage increase known as “trigger point indexation”. Theories about distributive conflict are the basis to describe the way the inflationary dynamic behaves in a system of wage periodical indexation, which is compared with the “trigger point” system. The main conclusion is that if Govern-ment don’t manage to control prices strictly, the menace of an acceleration of inflation is considerable. In this context, the article discusses also some of the differents sceneries for the Brazilian economy that may be foreseen for the next future as a consequence of the conflicts observed now.

Vol.8, n.o3(31), 1988
As metas de inflação: sugestões para um regime permanente
Fabio Giambiagi e José Carlos Carvalho

In 1999 the inflation targeting regime was introduced in Brazil in an environment plenty of uncertainties and relatively high inflation rates. As a consequence, the set of rules that to this day govern the Brazilian regime still lack a strong institutional support. This paper makes some proposals for a permanent inflation targeting regime. In doing so, we discuss how can a greater institutional commitment be achieved with the inflation targeting setup. We also discuss issues on what the permanent inflation target level should be and also how much deviation from the target should be tolerated. Based on these issues, we suggest a set of rules to be adopted in Brazil.

Vol.22, n.o3(87), 2002
Política salarial e distribuição de renda: uma proposta para discussão
Fábio Giambiagi e Ricardo Cicchelli Velloso

This article suggests a Government policy for improving the Brazilian income distribution which relies on the application of a formulae that makes increases of productivity be shared accor-ding to the relative wages of workers. In a context in which short-term constraints — specially the inflation — are not as important as they were until recently and structural problems tend to be the main aim of Government policy, the conclusions of this article are that a better income distribu-tion can be obtained if the economy continues to grow at sufficient high rates and that this could happen provoking losses on the earnings of some income classes.

Vol.7, n.o4(28), 1987
Comentário a
Fabrício Leite, Gustavo Aggio e Eduardo Angeli

The paper aims at analyzing the article by Gerson Lima on the manner by which fiscal deficit should be covered. It presents a more general dynamic model, where the principle of effective demand is explicitly used. By doing that, it is possible to treat as endogenous variables the national income and the government entries, what brings the result that the public debt must not follow an explosive path unless the very restrictive conditions of Lima's paper prevail. It also evaluates Lima's implicit inflation theory, and argues against his approximation to Friedman's framework.

Vol.29, n.o4(116), 2009
Persistência inflacionária e curva de Phillips novo-keynesiana para o Brasil
Fernando de Aquino Fonseca Neto

Inflation persistence and new Keynesian Phillips curves for Brazil. In this paper is shown that sustainable inflation persistence has theoretical support not only due price indexation, but also because of micro-foundations based on assumptions of Simon’s bounded rationality and because of persistent mark-up shocks. the new keynesian phillips curve, estimated for brazil for the period 2000/2008, and the partial coefficients of determination for moving sub-periods of 36 months identifies inflation persistence as the main determinant of inflation, with the capacity gap presenting larger importance only in the end of the sample period. Inflation persistence requires harder monetary policy when neither accommodation is acceptable nor complementary policies in order to reduce it, such as the minimization of indexation mechanisms and control of the market power, are adopted.

Vol.30, n.o2(118), 2010
Crescimento econômico e renegociação da dívida externa
Fernando de Holanda Barbosa e Manuel Sánchez de la Cal

The objective of this paper is to analyze the negotiation of Brazil’s foreign debt within a strategy of economic growth. It draws a general profile of the main characteristics of Brazi-lian indebtedness, emphasizing the gross errors of economic policy made during the period 1974/89. The paper presents a fairly simple model of foreign-debt dynamics and describes the framework of debt-negotiation program aims at fighting inflation and restoring econo-mic growth.

Vol.12, n.o1(45), 1992
A dinâmica da hiperinflação
Fernando de Holanda Barbosa, Waldyr Oliva e Elvia Sallum

A hyperinflation model is developed where the money and goods markets clear in-stantaneously, expectations are rational and there is inertia in the price system due to wage indexation mechanisms. The model is described by a nonlinear system of differential equations and Hopf bifurcation theorem, regarding the public deficit as a parameter, is used to study the dynamic properties of the system. The dynamics of the model is capable of generating hyperinflation processes, as well as other paths that are commonly observed in high inflation countries.

Vol.13, n.o1(49), 1993
Uma contribuição ao debate em torno da eficácia da política monetária e algumas implicações para o caso do Brasil
Fernando J. Cardim de Carvalho

A contribution to the debate on the efficacy of monetary policy and some implications in the case of Brazil. The main opposition between Keynesian and Classic monetary theories is defined by the former’s proposition of money non-neutrality in the long period. According to Keynes, it is not possible to describe a monetary economy’s long period position without first specifying the monetary policy it is adopting. The policy is described by the choice of the short-term interest rate which exerts an important determining influence on the long term rate and, therefore, on real investment decisions. Based on this reasoning, inflation target monetary policy regimes are criticized, in particular the one adopted in post-1999 balance of payments crisis Brazil because of its rious impact on investment and growth.

Vol.25, n.o4(100), 2005
A independência do banco central e a disciplina monetária: observações céticas
Fernando J. Cardim de Carvalho

Orthodox conventional wisdom related to monetary policy in the 1990s presents the independence of central banks as a condition for achieving durable price stability, as it did with respect to the adoption of fixed rules for monetary growth in the 1980s. The paper proceeds to a critical examination of the arguments, in which it is concluded that, besides the undesirable political implications of the proposal, the thesis is too dependent on specious and fragile concepts as the natural rate of unemployment and the allegedly inherent inflationary bias of monetary authorities as well as on a very narrow view of the role of monetary authorities.

Vol.15, n.o4(60), 1995
Alta inflação e hiperinflação: uma visão pós-keynesiana
Fernando J. Cardim de Carvalho

Inflation has become, in the 80’s, the most important barrier to resuming economic growth in Brazil. A post-Keynesian approach to this problem stresses the effects that continuing high inflation has on beliefs and institutions, especially the system of money forward contracts that is fundamental to organize and coordinate an entrepreneurial economy. A High Inflation Regime is defined by the introduction of new monies-of-account for forward contracts, that is, indexation, and by a change in the modes of price formation. It is show that High Inflation characterizes an unstable equilibrium that may degenerate into a hyperinflation. Thc permanence of high inflation, however, may engender stagnating tendencies.

Vol.10, n.o4(40), 1990
Imposto inflacionário: uma análise para a economia brasileira
Fernando M. DallAcqua

The paper analyses the relationships among inflation, inflationary tax and public deficit for the Brazilian economy during the eighties. Initially, these relationships are described somehow simplistically using the so-called inflation tax model. The working hypothesis are (1) there is an absolute limit to government’s deficit financing by inflationary tax; (2) a given amount of inflationary tax can be collected at either high or low rate of inflation and (3) the inflationary tax collected by the government depend on the monetary conditions of the economy. Using this analytical framework a simulations exercise is carried out to estimate the inflation-tax finance of the public deficit for the Brazilian economy during the period 1982-88. The main conclusions are: (1) the conditions of the inflationary tax finance change after 1986, when the focus of the economic policy shifts from the conventional orthodoxy to what is called heterodox approach; (2) the accelerating inflation has radiply weakened the ability of the government to collect inflationary tax and (3) under these conditions price freezes and exchange rate fixing may be considered necessary to ensure a transition from a high to a low level of inflation.

Vol.9, n.o3(35), 1989
Meta inflacionária, juros e preços no varejo brasileiro
Fernando Nogueira da Costa, Simone Silva de Deos e José Valney de Brito

In this paper we analyze inflation targeting, focusing on the interest – price transmission mechanism. Its theoretical foundations are analized based on conventional and alternative literature. We discuss the recent performance of the retail industry in Brazil, highlighting how monetary policy affects prices, both directly and indirectly. We conclude evaluating inflation targeting in a critical way. Our key hypothesis is that interest rates must be seen not only as an instrument to control the general price level and the level of activity, by indirectly regulating aggregate demand. It must also be seen as a fundamental and direct component of the prices formed in the Brazilian retail industry. The big risk of inflation targeting, on the one side, is to increase deflation and, on the other, to create stagflation – unemployment and inflation.

Vol.21, n.o4(84), 2001
On high interest rates in Brazil
Francisco Lafaiete Lopes

This article examines the question of why interest rates are so high in Brazil as compared to the international average. It looks at theoretical arguments based on excessive government deficits, structural lack of private savings, inflation bias, excessive investment demand and fear of floating. An informal look at the evidence does not strongly corroborate any of these arguments. Hence a wise central bank should consider "testing" the market to make sure it is not dealing with an extreme equilibrium configuration or a long standing disequilibrium.  

Vol.34, n.o1(134), 2014
O mecanismo de transmissão de política monetária em uma economia em processo de estabilização: notas sobre o caso Brasil
Francisco L. Lopes

This note presents some considerations about the difficulty to understand the trans-mission mechanism of monetary policy. This difficulty becomes even more accentu-ate in case of economies experiencing a change in an environment from high to low rates of inflation, with an analysis to the Brazilian case.

Vol.17, n.o3(67), 1997
A atuação do banco central em uma economia estabilizada: é desejável adotar metas inflacionárias no Brasil?
Francisco Rigolon e Fabio Giambiagi

This article deals with the possible adoption of explicit inflation targets by monetary authorities in Brazil, following the example of the experiences of New Zealand, Canada, the United Kingdom, Sweden, Finland, Australia and Spain. Inflation targets would work, first, as a coordination device for those involved in the price and wage setting process, and second, as a transparent aim of the monetary policy, whose performance would be evaluated by the adherence of inflation to the targets. The paper shows the motivations that explain the adoption of the regime, discusses its theoretical fundamentals, and analyzes the problems and trade-offs related to its implementation in practice. Finally, based on the theory and the international experience, some arguments in favour of the adoption of the regime of inflation targets in Brazil are developed.

Vol.19, n.o3(75), 1999
Juros, câmbio e o sistema de metas de inflação no Brasil
Franklin Serrano

Interest rate, exchange rate and the system of inflation target in Brazil. In the consensus view of the Brazilian system of inflation targeting, the core of inflation is due to demand shocks; the rate of interest is set to control demand; and some variation in the exchange rate happens as “collateral damage”. In this note we argue that in reality core inflation comes from cost push; the interest rate affects the exchange rate; changes in the exchange rate affect costs and prices; it is the effect of interest rates on demand that is the “collateral damage” and that the long run anchor of the system is low average real wage rigidity.

Vol.30, n.o1(117), 2010
Metas de inflação em perspectiva: a influência do trinômio reputação-credibilidade-transparência sobre a economia
Gabriel Caldas Montes

Inflation targets in perspective: the influence of the reputation-credibility-transparency trinomial on economics. Although target regime seeks to serve as a reference for the expectation formation process of the agents, its implementation does not necessarily imply the acquisition or the best result in terms of economic growth. The present article aims the development of a model that explains, by firms' investment decisions, the prodict path behavior, undertaking monetary authority may present distinct situations associated with the reputation-credibility-transparency trinomial. The article also detaches different kinds of reputation and its degrees.

Vol.28, n.o4(112), 2008
Uncertainties, monetary policy and financial stability: challenges on inflation targeting
Gabriel Caldas Montes

This work aims at presenting the challenges that inflation targeting central banks may face since uncertainties represent a harmful element for the effectiveness of monetary policy, and since financial instabilities may disturb the transmission mechanisms – in particular, the expectation channel – and thus the economic stability. Financial stability must not be considered as a simple goal of monetary policy, but a precondition for central banks operate their policies and reach the goals of inflation and output stability. The work identifies different sources of uncertainties that surround central banks’ decisions; and approaches the role that inflation targeting central banks should play according to some basic principles that can serve as useful guides for central banks to help them achieve successful outcomes in their conduct of monetary policy.

Vol.30, n.o1(117), 2010
A hiperinflação húngara de 1945-46
Georges Hegedus

This paper provides a description of the Hungarian hyperinflation in the period immediately after Word War II. It is shown that the inflationary process started with the necessity of financing the high costs of the war effort. After the war the reduction of production capacity, reparation payments and the large government deficit provided the factors for rapid growth of the rate of inflation. Reference is made to the unsuccessful effort to introduce an indexed currency. The stabilization process is seen as a result of careful planning and a very harsh redistribution of inco-me among the various social classes.

Vol.6, n.o2(22), 1986
Matemática Agradável
Gerson Lima

Pleasant Mathematics. This paper suggests a reconsideration of the principle that public deficits should be financed by public debt. Two main reasons are offered. First, it is admitted that public debt is an economic variable whose time behaviour is better described by a first difference equation instead of an accounting identity. The convergence condition thus obtained requires either a nominal negative interest rate or that government bonds are used to raise tax income, hypotheses not theoretically granted. As a consequence, if primary surplus is not sufficient to match interests’ payment, it will be observed an explosive trend in the public debt, the due interests and the money issuing. Therefore, it lacks support to the idea that public debt prevents inflation. Second, it is shown that financing public deficit through money issuing leads to a stable equilibrium money stock. The general conclusion is that, in order to simultaneously promote economic growth and inflation control, money issuing is preferable to public debt.

Vol.28, n.o3(111), 2008
Do cruzado ao Collor: os planos de estabilização e a agricultura
Gervásio Castro de Rezende

This paper traces the macroeconomic roots of the current agricultural crisis. It shows that the increase in inflationary instability after 1986, and the policies adopted by the Go-vernment, since then, to fight hyperinflation, caused the terms of trade of agriculture to be-come much more unstable, at the same time that the Government pulled back the support they had been providing to agriculture; these adverse conditions ultimately caused the reduc-tion of activity levels in agriculture in 1989 and 1990. The paper concludes by pointing out the implications for the current stabilization strategy.

Vol.12, n.o2(46), 1992
A note on inflation targeting and economic growth in Brazil
Gilberto Libânio

This paper analyzes the relation between monetary policy and economic performance in Brazil during the period 1999-2006. In particular, it discusses the growth effects of the inflation targeting regime through its effects on aggregate demand. It is argued that monetary policy under IT reacts in a procyclical and asymmetric way to fluctuations in economic activity (too ‘tight’ during recessions, not so ‘loose’ during expansions). Such pattern may generate a downward bias in aggregate demand, with negative real effects on output growth and employment. Our results suggest that monetary policy has been procyclical and asymmetrical in Brazil under inflation targeting. The main economic policy implication of this study is that central banks should consider more seriously the real effects of monetary policy on output and employment.

Vol.30, n.o1(117), 2010
Programas de estabilização, mistificação tecnocrática e câmaras setorias
Guido Mantega

The present paper discusses the nature and the conditions of stabilization plan in democratic societies, criticizing the technocrats approach that reduces those plans to a mere technical decision, this hiding their social consequences and implications in terms of gains and losses. The inefficacy of orthodox and heterodox plans from in recent years said to be due to their lack of clarity, politics and legitimacy. A stabilization program cannot be left in the hands of market or cannot be resumed to a fiscal adjustment and monetary restrictions, but must have income policies, introduced by the State and with the active participation of social classes. The experience of the sectorial chambers in certain branches of industrial activities harbours an insight towards a new mechanism of coordination of prices, wages and public prices, that can slow down that inertial inflation and keep price increase in Brazil under control.

Vol.14, n.o2(54), 1994
Inflação, clientelas e preços relativos
Gustavo H. B. Franco e Carlos Parcias Jr.

The paper discusses the factors governing relative price changes often observed in sudden desinflations. It examines inflation induced changes in consumer behavior in markets with im-perfect information and, along similar lines, discusses ways through which inflation affects firms pricing decisions, focusing more specifically on changes in demand elasticity and on cash flow uncertainty.

Vol.11, n.o3(43), 1991
Efeitos da independência do Banco Central e da taxa de Rotatividade sobre a inflação brasileira
Helder Ferreira de Mendonça

The effects of Central Bank independence and the rate of turnover on the Brazilian inflation. Nowadays, the belief is strong in the Brazilian federal government that operational central bank independence is a basic condition to assure price stability. The literature concerning this subject highlights that a high degree of independence and a low turnover of central bank governor are associated with low inflation. This paper analyzes the relation between central bank independence and inflation in Brazil during 1980-2002. The findings denote that there is no effect on inflation due to an increase in degree of independence and a fall in turnover rate.

Vol.26, n.o4(104), 2006
Metas para inflação e taxa de juros no Brasil: uma análise do efeito dos preços livres e administrados
Helder Ferreira de Mendonça

Inflation targets and exchange rate in Brazil: an analysis of the effect of market and administered prices. After surpassed more than a half decade since the adoption of inflation targeting in Brazil, it can be seen that maintaining a high interest rate is inherent to the strategy for the conduction of the monetary policy. The objective of this paper is to show that the present policy for defining the basic interest rate of the economy, based on the response to inflation considering both market prices and administered prices, is onerous for the Brazilian society. Based on findings from empirical evidence in the period 1999-2004, the adoption of a core inflation, a change in the time horizon for definition of targets, and, in common agreement between Banco Central do Brasil and National Treasury a definition of these inflation targets, as a framework to increase efficiency of the monetary regime creating possibilities for reducing the Selic rate is proposed.

Vol.27, n.o3(107), 2007
Mensurando a credibilidade do regime de metas inflacionárias no Brasil
(Measuring the credibility of the inflation targeting in Brazil)
Helder Ferreira de Mendonça

O objetivo deste artigo é aplicar dois índices para medir a credibilidade da meta de inflação no Brasil e analisar seus resultados. Os resultados indicam que a estrutura adotada para este regime monetário no Brasil não é adequada para construir credibilidade. 

The aim of this paper is to apply two indexes for measuring the credibility of the inflation targeting in Brazil and to analyze their outcomes. The findings denote that the framework adopted for this monetary regime in Brazil is not adequate for building credibility.

Vol.24, n.o3(95), 2004
Independência do Banco Central e Equilíbrio fiscal: algumas observações para o caso brasileiro
Helder Ferreira de Mendonça

Central Bank Independence and Fiscal equilibrium: Some observations for the Brazilian Case. The objective of this paper is to analyze the main theoretical arguments for the analysis of the conduction of monetary policy on the fiscal side. Besides this, an analysis is made of the possible effects on the fiscal balance from the conduction of the monetary policy in the search for price stability after the Real Plan and due to an increase in the central bank independence (CBI) in the Brazilian case. The findings denote that the strategy for the conduction of the adopted monetary policy and the increase in the degree of CBI did not contribute to an improvement in the fiscal balance.

Vol.26, n.o1(101), 2006
Inflation Bias: an appraisal
Helder Ferreira de Mendonça

This short paper offers a brief appraisal of the conventional inflation bias and Cukierman’s new inflation bias. It may also be seen that a lack of equilibrium in the balance of payments represents another reason for the emergence of the inflationary bias in an economy.

Vol.25, n.o2(98), 2005
Metas para a taxa de câmbio, agregados monetários e inflação
Helder Ferreira de Mendonça

Since the beginning of the Quantitative Theory of Money by David Hume, the relation between money and price level has been analyzed by monetary economists. Nowadays the search for price stability has induced the policy-makers to adopt one of three monetary regimes: fixed exchange rate, monetary targeting, or inflation targeting. The present paper makes a comparative analysis among these possibilities highlighting the advantages and disadvantages that belong to each monetary regime. Since the beginning of the Quantitative Theory of Money by David Hume, the relation between money and price level has been analyzed by monetary economists. Nowadays the search for price stability has induced the policy-makers to adopt one of three monetary regimes: fixed exchange rate, monetary targeting, or inflation targeting. The present paper makes a comparative analysis among these possibilities highlighting the advantages and disadvantages that belong to each monetary regime.

Vol.22, n.o1(85), 2002
A teoria da credibilidade da política monetária
Helder Ferreira de Mendonça

This paper analyzes the main arguments concerning credibility theory for monetary authority from the mainstream literature. In this sense, the origin of the debate entitled rules versus discretion is examined and the advances in literature from the central bank independence proposal. The findings denote that the problem of the inflationary bias for conduction of monetary policy is a result of a set of ad hoc hypothesis used by the literature. Thus, the developments in the literature concerning the credibility from inflationary bias represent a particular case for monetary theory.

Vol.22, n.o3(87), 2002
Transparência do Banco Central: uma análise para o caso brasileiro
Helder Ferreira de Mendonça e Adriana Inhudes

Central Bank transparency: an analysis of the Brazilian case. Nowadays there is a tendency among central banks of increasing transparency in the conduction of the monetary policy. After the adoption of inflation targeting in Brazil there was an increase in the communication of the Central Bank of Brazil with the public. This paper makes a brief review of the recent theoretical and empirical literature concerning this subject. Furthermore, an analysis due to the transparency in the conduction of Brazilian monetary policy on important macroeconomic variables is made. The findings denote that an increase in transparency improves the behavior of several macroeconomic variables.

Vol.30, n.o1(117), 2010
Evolução e características do emprego no setor bancário
Hugo E. A. da Gama Cerqueira e Wilson A. Costa de Amorim

This article analyses the effects of recent transformations in the Brazilian banking system on the level and composition of employment in this sector. We indicate the measures taken by banks in order to adjust to low levels of inflation and its consequences over the level of employment, the turnover, and the spatial distribution of personnel. We also discuss the changes in the employees’ profile associated with the intensification of automation and changes in the management of the labor process.

Vol.18, n.o1(69), 1998
Recessão, inflação e dívida interna
Ignácio Rangel

When the economy is in recession, inflation accelerates in the Brazilian economy. In order that prices go up during recession corporations, in an oligopolized economy, reduce production and increase prices, instead of doing the contrary, as conventional economies teach. To overcome recession it is necessary that entrepreneurs take advantage of the new opportunities of investment Ira new dynamic sectors of the economy. In Brazil public utilities is the sector that has more opportunity of growth. Private enterprise, national and multinational, that have now idle capacity and excess savings will transfer these savings. To public utilities as soon as institutional and financial arrangements make this possible.

Vol.5, n.o3(19), 1985
Evolução recente e perspectivas da economia mexicana
Jaime Ross

This paper attempts to analyse the relations between the crisis and Mexican economic policy, basically focusing three points: (a) the way by which the adopted economic policy has contributed to provoke a situation of depression with hyperinflation; (b) the problems and short term prospects which derive of the limits of the adopted political stabilization scheme; (c) the problems and the medium and long term prospects which wil1 be faced by the Mexican economy during the period after the stabilization phase.

Vol.4, n.o1(13), 1984
Was there an alternative to the brazilian crisis?
Jan A. Kregel

In difference from Asia, high interest rates and stable exchange rates associated with the Real Plan did not produce a corporate debt deflation because of the low corporate indebtedness in Brazil. Instead high interest rates caused both the foreign and fiscal balances to deteriorate, reducing confidence. Any attempt to reduce interest rates brought the threat of currency weakness and the risk of inflation. The crisis was due to the reliance on high interest rates to attract capital flows which were insufficient to produce investment which gave a satisfactory rate of growth.

Vol.19, n.o3(75), 1999
The Global Crisis and the Implications for Developing Countries and the BRICs: Is the
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
Global booms and busts: How is Brazils middle class faring?
Jan Peter Wogart

Brazil’s Post War economic history has been marked by inflationary booms and busts, which kept large parts of the population poor, as income distribution remained highly skewed, and most governments failed to put enough efforts and resources into education and health. That seems to have changed recently, as an increasing number of studies have shown considerable advances in the incomes of the lower and the middle classes. This essay examines those findings and puts them into a historical perspective, discussing earlier attempts and hopes of Brazilian policy makers to advance the welfare of the population. It concludes that while the last fifteen years have been remarkable for the country to achieve macroeconomic stability and while the increasing efforts of supporting the poor seemed to have been moving income distribution slowly towards a more equal level, there is still a long way to go. The 2008 world financial crisis also hit Brazil hard, but the recovery has been smoother and faster than in any OECD country. The impact of the current crisis may provide a good test as to the robustness of the previous trends to further the wellbeing of the poor and the middle class

Vol.30, n.o3(119), 2010
Argentina and the global capital roller coaster of the 1990s
(Argentina e a montanha-russa do capital global dos anos 1990)
Jan Peter Wogart

Este ensaio analisa o experimento argentino “currency board” durante a década de 1990, tanto do ponto de vista teórico quanto histórico. Descobriu que as tentativas anteriores de controlar a inflação com uma taxa de câmbio quase fixa em um ambiente altamente politizado deveriam ter sido uma lição a ser ouvida. Ao detalhar as várias deficiências das políticas econômicas domésticas, um amplo espaço é dedicado a examinar os mercados de capitais internacionais e seu impacto no programa argentino. Além disso, sustenta-se que o ambiente político argentino, cuja estabilidade foi crucial para o sucesso nos primeiros anos, deteriorou-se tanto depois de 1996 que contribuiu significativamente para o colapso do programa econômico e do próprio sistema. O ensaio conclui com uma breve consideração das políticas econômicas chilenas, que foram caracterizadas por um grande grau de pragmatismo e prudência e, consequentemente, conseguiram escapar do terrível destino de seu vizinho. 

This essay analyzes the Argentine “Currency Board” experiment during the 1990s, both from a theoretical and historical point of view. It finds that earlier failed attempts to control inflation with a quasi fixed exchange rate in a highly politicized environment should have been a lesson to heed. While detailing the various shortcomings of the domestic economic policies, ample space is devoted to examine the gyrating international capital markets and their impact on the Argentine program. Moreover, it is maintained that the Argentine political environment, the stability of which was crucial for success in the early years, deteriorated to such an extent after 1996 that it significantly contributed to the breakdown of the economic program and the system itself. The essay concludes with a short consideration of the Chilean economic policies, which were characterized by a great degree of pragmatism and prudence and consequently succeeded to escape the dire fate of its neighbor.

Vol.24, n.o3(95), 2004
Conflito social e políticas populistas na america latina
Jeffrey D. Sachs

The central hypothesis of this paper is that high-income inequality in Latin America contributes to intense political pressures for macroeconomic policies to raise the incomes of lower income groups, which in turn contributes to bad policy choices and weak economic performance. The paper looks in detail at one common type of policy failure: the populist policy cycle. This particular type of Latin Ame-rican policymaking, characterized by overly expansionary macroeconomic policies which lead to high inflation and severe balance of payments crises, has been re-peated so often, and with such common characteristics, that it plainly reveals the linkages from social conflict to poor economic performance.

Vol.10, n.o1(37), 1990
A inflação brasileira e o plano real
Jeffrey Sachs e Álvaro Zini Jr.

By most standards, Brazilian inflation has been the most intractable in world history. The time span of high Brazilian inflation is unparalleled: inflation has exceeded 50 percent per annum every year since 1979, and has been at double digit rates every year since 1957. Even Argentina, the perennial rival of Brazil for the dubious distinction or longest-running high inflation, has achieved price stabilization since April 1991. There have been innumerable major and minor attempts at Brazilian stabilization, including at least five major “Plans” since 1986. Each has failed. Brazil is currently in the midst of another major stabilization attempt, the Plan Real. This paper assesses the difficulties inherent in Brazilian stabilization programs, and the prospects for the Plan Real, including its particular motivations and its chances for success.

Vol.15, n.o2(58), 1995
The U.S. economy: are analysts missing the point?
João Marcus M. Nunes

The conventional view on the U.S. economy is that economic growth above “potential” is bad for bonds since it spells inflation. The purpose of this note is to show that following the Volker deflation (1980/82), the policy regime changed and greater economic stability obtained.

Vol.18, n.o1(69), 1998
O dólar na Argentina e a URV no Brasil: objetivos, funcionalidade e resultados obtidos
João Sicsú

The article discusses targets, functionality and results of the process to set relative prices in Brazil and Argentina in the pre-desinflation period, that is before Real Plan and Cavallo Plan respectively.

Vol.18, n.o4(72), 1998
A URV e sua função de alinhar preços relativos
João Sicsú

The Real Plan of stabilization was divided into three phases. The first phase concerned problems of fiscal nature: the governmental deficit. The second one, performed from March to June of 1994, purposed to balance relative prices and remuneration. The third step would knock down the inflation. The article’s aim is to discuss if the device introduced in the second step of the Plan, the Unidade Real de Valor (URV), carried out the goal of aiding the Brazilian economy in the discovery of a balanced vector of relative prices. One carries to the conclusion that the URV did not play its role properly and that the Plan, despite this problem, was successful in the initial period of the third step due to other motives — also discussed in the text.

Vol.16, n.o2(62), 1996
Teoria e evidências do regime de metas inflacionárias
João Sicsú

This article shows that the theory that supports the inflation targeting regime does not have a relationship with reality. Moreover, this stresses that monetary policy should be used to full capacity because it not only controls inflation, but is also useful to achieve real goals, such as employment. The article shows that there is no evidence that the regime reduced inflation in the 1990’s. Developed countries which adopted the regime and developed countries which did not adopt inflation targeting regime have both reduced and kept inflation under control.

Vol.22, n.o1(85), 2002
Argentina: Cavallo, galope para o desastre?
Joaquim Elói Cirne de Toledo

This paper analyses the latest stabilization effort in Argentina, the Cavallo Plan (named after its mentor, Domingo Cavallo). The analytical framework is the tradeable non tradeable textbook model, a.k.a. the dependent economy model, from the Australian trade literature. The model is extended to include the effect of real wages on aggregate demand, and therefore on activity. A Phillips— curve description of inflation is also added. It is shown that, by moving from a floating to a fixed-exchange rate regime, the Argentinean economy attained domestic equilibrium, at the cost of BoP equilibrium. The paper shows that the ensuing trade deficit may lead to a classical run on reserves, forcing the return to floating exchange rates. In the process, the economy will go through a complete economic cycle, returning to inflation.

Vol.12, n.o3(47), 1992
Pressure groups and inflation: a cyclical model
Jorge Sabe Arbache e João Ricardo Faria

“Este texto apresenta argumentos segundo os quais as pressões de grupos organizados — mas que atuam de forma descoordenada — sobre as decisões de governo relacionadas a questões fiscais, provocam aumento da inflação, ao mesmo tempo em que propiciam a desorganização da economia. Esse último efeito impõe limites ao comportamento desses grupos. Um modelo do tipo “presa-predador” é utilizado para descrever a correção cíclica entre o nível de organização de tais grupos e a inflação.”.

Vol.16, n.o3(63), 1996
Um modelo macrodinâmico pós-keynesiano de simulação
José Luis Oreiro e Fábio Hideki Ono

A post-keynesian macro-dynamic model of simulation. The objective of this article is to present the structure and the simulation results of a one-sector macro-dynamic model that embeds some elements of the post-keynesian theory. The computational simulation of the model replicates some important features of capitalist dynamics as the phenomenon of cyclical growth, the long-run stability of the profit rate and functional distribution of income, the maintenance of idle-capacity in the long-run and the occurrence of a single episode of deep fall in real economic activity, which is in accordance with the rarity character of great crashes in the history of capitalism. Moreover, the simulation results show that a great reduction in inflation rate will be followed by an increase of financial fragility, increasing the like-hood of a great depression. As a policy advice derived from the simulation results, we can state that the Central Bank should never promote big reductions in inflation rate.

Vol.27, n.o1(105), 2007
The latin-american monetary system after the end of inflation
José Tavares de Araújo Jr.

Este artigo discute três tópicos interdependentes. O primeiro é o de que as reformas econômicas implementadas na América Latina a partir de meados dos anos 80 não foram suficientes para assegurar a estabilidade cambial na região. O segundo é o de que existem condições propícias para iniciar o processo de convergência macroeconômica entre os países latino-americanos, O terceiro tópico refere-se ao papel estratégico a ser desempenhado por Argentina, Brasil, Canadá e México como redutores do grau de assimetria gerado pela presença da economia americana.

Vol.14, n.o4(56), 1994
A questão da estabilização nos anos 80: um enfoque institucional
Leda Maria Paulani

This paper deals with the relation between institutions and stabilization problems. Its purposes is to demonstrate that the consideration of the institutions may provide answers for questions that the conventional macroeconomic analysis have not been succeeding in. The main questions is: why, in Brazil, from the beginning of the eighties onward, the inflation rate does not fall to a civilized levels but does not go to a hyperinflationary process? The approach is that provided by the “New Institutional Economics” (NIE) and the tentative hypothesis is that the formal indexation — a allocative institution created by the military government — (PAEG, 1967) — would have displaced the constitutive and fundamental institution, i. e, the money, the official currency. As a result of this process — a different process within Latin America because of the official and legal sign of the Brazilian indexation —, the recurrent rise of prices would have transformed itself into an institution.

Vol.14, n.o1(53), 1994
Os programas de estabilização ortodoxos no Brasil - 1964/68 e 1980/84: uma reflexão sobre suas conseqüências perversas
Leonel Mazzali

The perverse effects associated to orthodox stabilization programmes, specially persist-ent inflation accompanied by a prolonged period of recession with unemployment, attract the attention on the evaluation of consistency between the orthodox approach and the economic situation which characterize the crisis. Then, the comparative study of two economic stabiliza-tion policies in Brazil, in the sixties and eighties — PAEG (1964-1968) and Stabilization Pro-gram (1980-1984) — gives opportunity to develop an analysis of the incoherencies in orthodox view about the roots of inflation and balance of payments disiquilibria.

Vol.11, n.o3(43), 1991
Metas de inflação, política monetária e investimento: um estudo para dezessete países
Luis Alberto Pelicioni e Marco Flávio da Cunha Resende

Inflation targets, monetary policy and investment. In this paper two hypotheses about the relationship between monetary policy and investment in the context of the inflation target system were tested. One of these hypotheses is based on the idea of neutrality of money, and the other hypothesis is based on the reject of that idea. An investment equation for seventeen economies using a piece-wise dummy variable was estimated by the Methodology of Panel Data. The results highlight that a negative correlation between current expectation of restrictive monetary policy and current investment rose after the inflation target system implementation.

Vol.29, n.o3(115), 2009
La demanda de M4 y la substitución de moneda en México: 1978-1990
Luis Miguel Galindo P.

The objective of this essay is to analyze the demand for M4 and the capital flows in Mexico for the period 1978-1990. The econometric analysis heavily uses the general to specific methodology, cointegration and an error correction model. The empirical evidence shows the existence of a stable demand for M4. The demand for M4 depends, in the long run, on income and interest rate. In the short run the changes in the inflation rate and the currency substitution effect are relevant factors to explain M4. The presence of currency substitution implies that the authorities must take account of the differentials in the interest rates between Mexico and the United States.

Vol.16, n.o2(62), 1996
Modelos ortodoxos de inflação alta: uma análise crítica
Luiz Antonio de Oliveira Lima

This paper argues that orthodox models of high inflation for developing countries, based on seminal Cagan’s model of hyperinflation, present some weak points by ignoring the complexity brought to the economy by high inflation, as well as by assuming that economic agents can dwell in this situation because they are endowed with an “unbounded rationality” to take their decisions. The paper argues too, that in order to understand this process and to suggest proper policies, it is necessary to recognize that a desinflationary process requires gradual policies that allow economic agents to adjust their behavior to the new circumstances that are brought about by these policies, the hypothesis to make about this behavior is that is characterized by a “bounded rationality”.

Vol.16, n.o4(64), 1996
Metas inflacionárias: a análise convencional e um modelo alternativo
Luiz Antonio de Oliveira Lima

Inflation targeting: the conventional analysis and an alternative model. This article has two aims: the first one is to present a formal model of the monetary policy identified generally as “inflation targeting policy”, an instrument of intervention of the central bank, through the short run nominal interest rate. The second aim is to discuss and criticize the theoretical assumptions of the model specially the concepts of “natural rate of interest” and of potential product presented by the “augmented Philips curve”; and to present a more realistic model of inflation targeting which does not assume the hypotheses above, and in which inflation targeting is based on the control of real rate of interest.

Vol.28, n.o2(110), 2008
Os dois congelamentos de preços no Brasil
Luiz Carlos Bresser-Pereira

This paper compares the Cruzado Plan with the Bresser Plan. Both were price freezes based on the theory of inertial inflation. However, while the Cruzado Plan intended to end with inflation, the Bresser Plan was an emergency plan aimed to cope with the deep financial and economic crisis left by the failure of the Cruzado. It achieved this objective. As to inflation, the authors of the plan expected that the rate of inflation would be back to around 10 per cent in December 1987; the actual rate of inflation in this month was 14 per cent.

Vol.8, n.o4(32), 1988
Política administrativa de controle da inflação
Luiz Carlos Bresser-Pereira e Yoshiaki Nakano

After summarizing a model of autonomous or administered inflation presented in an another paper, the author analyses the Keynesian and the monetarist policies of controlling inflation. Finally they discuss at lenghty an alternative policy of price stabilization — an administrative policy —based on price controls and programmed deindexation, associated with moderate groth of the economy and followed by monetary and fiscal adjustment.

Vol.4, n.o3(15), 1984
Auge e declínio nos anos setenta
Luiz Carlos Bresser-Pereira

Analysis of the Brazilian economy between 1970 and 1982, focusing on its cyclical nature. After a short analysis of the economy ‘s expansion up to 1974, the author discusses alternative theories for the reversion of the cycle. With the subsequent slowdown of economic growth we have inflation and an explosive increase in the foreign debt. Finally the article analyses the 1981-1982 recession, and the underlying distributive crisis.

Vol.3, n.o2(10), 1983
Inflação inercial e plano cruzado
Luiz Carlos Bresser-Pereira

In February 28 of 1986 the Brazilian government decided to freeze all prices. This “heterodox shock” and the development by Brazilian economists of the theory of inertial inflation, which served as a theoretical basis for the shock, are here discussed.

Vol.6, n.o3(23), 1986
O Segundo Consenso de Washington e a quase-estagnação da economia brasileira
Luiz Carlos Bresser-Pereira

While in the social and ethical realms the Cardoso administration (1995-2002) was successful, its economic outcomes were frustrating. In these eight years the investment rate did not increase and income per capita growth lagged, while public and foreign debts increased substantially. This poor economic performance may be explained by three chained causes: a mistake in agenda setting, the adoption of the Second Washington Consensus, and the alienation of elites. The decision of setting high inflation as the major problem to be tackled instead of achieving equilibrium in foreign accounts represented a major macroeconomic mistake, which can be explained by the Second Washington Consensus. This consensus proposed in the 1990s that highly indebted countries should grow counting on foreign savings, although this is not the experience among OECD countries. The outcome was to evaluate the real, to increase artificially wages and consumption, so that instead of growth we have been increasing indebtedness. Why this flopped strategy was adopted? Rich countries’ interests are not difficult to guess. On the part of Brazil, the only explanation is Brazilian elites’ alienation in relation to the country’s national interest. As a final outcome, the Cardoso administration ends with another balance of payments crisis.

Vol.23, n.o3(91), 2003
A crise financeira de 2008
Luiz Carlos Bresser-Pereira

In developing countries there is a tendency to the overvaluation of the exchange rate. It has two structural causes: the Dutch disease and the attraction that higher profit and interest rates usually prevailing in developing countries exert on foreign capitals, and four policy causes: the growth with foreign savings policy, the control of inflation to exchange rate anchors, the ‘capital deepening’ policy, and exchange rate populism. Either the country neutralizes this tendency and grows fast, or does not and will suffer cyclical balance of payment crises.

Vol.29, n.o1(113), 2009
As três formas de desvalorização cambial
Luiz Carlos Bresser-Pereira

When the exchange rate is overvalued and the trade balance is negative, there are three forms of devaluating the local currency: direct devaluation, fiscal adjustment, and increase of productivity at a higher rate than the competitors. The three forms involve a change in relative prices, with the reduction of the prices of nontradables in relation to tradables, and, so, a relative reduction of real wages. Productivity increase is a first best, since it does not entail real wage reduction, fiscal adjustment is a second best, since it is anyway necessary and does not contain the risk of inflation. Given this risk, direct devaluation is a third best. Yet, since it is difficult to control productivity increase in the local economy and impossible in the competing ones, and since fiscal adjustment leads to devaluation only indirectly as it reduces the demand for non-tradables, quite often policymakers resort to the third best alternative.

Vol.17, n.o1(65), 1997
A inflação decifrada
Luiz Carlos Bresser-Pereira

This paper is an account of the intellectual process that led, in the early 1 980s, to the definition of a new economic theory — the theory inertial inflation — and to the proposal of heterodox policies to deal with this type of high and chronic inflation, that, in intensity terms, stays between moderate or usual inflation and hyperinflation. The theory says that this type of inflation is the consequence of phased or staggered price adjustments. Economic agents are involved in an endless process of balancing and unbalancing relative prices, as they keep up with the going inflation, formally or informally indexing their prices. To fight this type of inflation orthodox or conventional fiscal and monetary policies are insufficient. In addition it is necessary to adopt a heterodox mechanism that neutralizes inertia, making possible to stop inflation. It is part of a book in preparation where the author reports his experience as finance minister of Brazil in 1987.

Vol.16, n.o4(64), 1996
Dolarização crônica: Argentina e Brasil
Luiz Carlos Bresser-Pereira e Aldo Ferrer

Dollarization is usually an acute monetary phenomenon. It accompanies short-lived infla-tionary processes. In Latin America, it is usual to hear of a threat of dollarization, but effecti-ve dollarization only takes place with hyperinflation. An exception is Argentina, where there is a historically new phenomenon: a chronic, long-lived dollarization. If chronic (Inertial) infla-tion is particularly difficult to control, chronic dollarization is still more difficult.

Vol.11, n.o1(41), 1991
Fatores aceleradores, mantenedores e sancionadores da inflação
Luiz Carlos Bresser-Pereira e Yoshiaki Nakano

 In English only in the on-line edition

In order to understand inflation or stagflation in present day oligopolistic capitalism, it is necessary to distinguish the accelerating, the maintaining and the sanctionating factors of inflation. Four are the accelerating factors: change in profit margins, change in real wages above (or below) productivity, changes in the real exchange rate and in the costs of imports. The basic maintaining factors are formal and informal indexation of the economy and mark-up pricing. Given and autonomous inflation, that is, independent of sustained demand or full employment, the fundamental sanctionating factor of inflation will be the money supply.

Vol.4, n.o1(13), 1984
Inflação inercial e curva de Phillips
Luiz Carlos Bresser-Pereira e Yoshiaki Nakano

This note introduces the problem of indexation of wages, exchange rate and other prices in the Phillips’ curve. With this aim we developed a simplified model of inflationary process decom-posing it in: (1) inertial inflation; (2) the Phillips’ curve; (3) administered or supply shock inflation. Using this model, first we show that a supply shock shifts the Phillips’ curve accelerating the trend rate of inertial inflation. Second, that a continuous demand pressure through Phillips’ curve leads to continuous acceleration of the rate of inflation. And third, that a rise in the rate of unemploy-ment may lead to a oligopolistic increase in the profit margin, which also leads a shift in the Phillips’ curve and a acceleration of the inflation.

Vol.6, n.o2(22), 1986
Hiperinflação e estabilização no Brasil: o primeiro plano collor
Luiz Carlos Bresser-Pereira e Yoshiaki Nakano

In this paper are analyzed (1) the conditions that gave rise to hyperinflation in early 1990, (2) the alternative programs of stabilization that were being suggested, and (3) the stabiliza-tion plan that was finally adopted, the Collor Plan, whose failure the authors, writing in June 1990, predict already in the title of the paper: “the first Collor Plan”. This plan examined according to (1) the logic behind freezing 70% of the financial assets; (2) the fiscal adjust-ment aspect; (3) the monetary or liquidity question; (4) the demand problem; and finally (5) the causes of the resurgence of inflation with recession. For this analysis, the authors utilize a neo-structuralist approach to the inertial or autonomous inflation prevailing in Brazil.

Vol.11, n.o4(44), 1991
Dinâmica da firma bancária em alta inflação
Luiz Fernando de Paula

This article examines the changes in the behavior of the banking firm strategies, risks, credit supply and revenues - in a high inflation regime.

Vol.17, n.o1(65), 1997
China: estabilidade e crescimento econômico
Marcelo José Braga Nonnenberg

China: stability and economic growth. A China apresentou um fabuloso crescimento desde 1978, ao mesmo tempo em que manteve a inflação estável. Quais os fatores responsáveis pelo sucesso da economia chinesa e até que ponto a política macroeconômica colaborou? Obviamente, diversos fatores foram responsáveis por esse crescimento apesar de nenhum deles, isoladamente, poder ser apontado como o principal. O artigo também indaga se será possível à China manter um ritmo semelhante de crescimento ou irá passar em breve por uma forte desaceleração, a exemplo do que já aconteceu com outros países asiáticos. Sugere-se que ela ainda poderá manter um vigoroso crescimento, bastante próximo à média observada nas 3 últimas décadas.

Vol.30, n.o2(118), 2010
Um modelo de NAIRU para o Brasil
Marcelo S. Portugal e Regina C. Madalozzo

In this article we present some estimates for the Non Accelerating Inflation Rate of Unemployment (NAIRU) using Brazilian Data. Two different models, Nishizaki (1997) and Debelle and Laxton (1997), are used. The NAIRU is estimated using both the IBGE and DIEESE data. The results show a linear Phillips curve for Brazil, and allow a good estimate of the NAIRU. For the IBGE data we obtain a time varying NAIRU while for the DIEESE data best estimate generates a fixed NAIRU. Our results are in line with the acceleration of inflation during the eighths and the price stability that follow the Real Plan.

Vol.20, n.o4(80), 2000
Política monetária, depósitos compulsórios e inflação
Márcio G. P. Garcia

Since the outset of the Real Plan, the government has resorted to much higher reserve requirements on bank’s liabilities, as well as to the creation of reserve requirements on credit (a bank’s asset) in the attempt to restrict the expansion of monetary aggregates and credit. The policy intention was right, although the design of the reserve requirements profile—i.e., the relative structure of the reserve require-ments on the different bank’s liabilities—was flawed. This is because there is a very high (initially a 100% marginal) reserve requirement on demand deposits, which is the liability that typically grows the most when high inflations subside. Since the beginning of 1995, tax changes made profitable to transfer even very short-term funds from demand deposits to short term mutual funds. Furthermore, when such transfer is undertaken, the overall reserve requirement falls substantially. The main policy recommendation is to use both the reserve requirements’ profile and the tax structure so that the aggregate financial wealth is distributed among its several components in a way compatible with low inflation. This will avoid future reallocations of portfolio, thereby increasing the efficacy of monetary policy.

Vol.15, n.o2(58), 1995
In search of a monetary constitution for Brazil
Marcio Ronci

The present paper examines various episodes of the monetary history of Brazil and other countries as well as the recent empirical evidence to look into critically the two principal proposals of monetary constitution for Brazil: currency board and independent central bank proposals. We outline also a monetary constitution inspired in the Pandiá Calógeras' Monetary Project (1926) with the only purpose of shedding light on the basic principles involved in the design of a monetary constitution aimed at controlling the power to create money and curbing inflation: (a) separation between the power to create money and the agents that determine public expenditure;(b) a clear monetary rule to constraint the power to create money; and (c) separation of the power to create money from the regulation and supervision of banks.

Vol.20, n.o1(77), 2000
Inflação e deflação de ativos a partir do mercado imobiliário americano
Maria Cristina Penido de Freitas e Marcos Antonio Macedo Cintra

Asset inflation and deflation triggered by the US housing financial system. This paper deals with the financial crisis triggered after the default of subprime mortgages in the United States which expanded to a global systemic crisis. It is divided into a brief introduction and three sections. The first section sums up the dynamics of inflation and deflation of real estate and financial assets which characterizes finance-led cycles. The second section covers major effect of financial assets deflation on the American and European banks. The third section focuses on measures implemented by central banks in order to manage this financial crisis.

Vol.28, n.o3(111), 2008
Ortodoxia e heterodoxia monetárias: a questão da neutralidade da Moeda
(Monetary orthodoxy and heterodoxy: the question of currency neutrality)
Maria de Lourdes Rollemberg Mollo

O artigo revisa as controvérsias sobre a neutralidade / não neutralidade da moeda na História do Pensamento Econômico, estabelecendo critérios para a classificação da ortodoxia e da heterodoxia, especialmente no que diz respeito às questões monetárias. O artigo enfatiza a não neutralidade da moeda sob a perspectiva da teoria monetária marxista da inflação, enfatizando as diferenças da teoria monetarista da inflação. 

The paper reviews the controversies on the neutrality/non neutrality of money in the History of Economic Thought establishing criteria for the classification of orthodoxy and heterodoxy, especially in what concerns monetary issues. The article emphasizes the non neutrality of money on the perspective of the Marxian monetary theory of inflation, making its point on the differences of the Monetarist theory of inflation.

Vol.24, n.o3(95), 2004
Reconhecimento social da moeda: observações sobre a inflação e a estabilização de preços no Brasil
Maria de Lourdes R. Mollo e Alfredo Saad Filho

This article deals with two aspects of inflation: distributive conflict and the role of extra money. In this context, the paper discusses some characteristic features of inflation process in Brazil, difficulties of the reproduction of the money during the inflation process and what were the aspects that have been solved by the Real Plan. Finally, Plano Real’s prospects are adressed.

Vol.21, n.o2(82), 2001
Plano Real e âncora cambial
Maria Luiza Falcão Silva

Recently, a number of Latin American countries with high inflation and various kinds of imbalances have experienced disinflation stabilisation programmes. Brasil implemented in July 1994 the Real Plan – an exchange-rate-based stabilisation experiment. This paper revisites this experience examining the main reasons for the collapse of the exchange-rate regime, in January 1999, from alternative theoretical point of views. What emerges from the paper is the conclusion that most of the “new” arguments presented to explain the Brazilian currency crisis are arguments used in the past by heterodox theorists.

Vol.22, n.o3(87), 2002
A inflação brasileira: lições e perspectivas
Mário Henrique Simonsen

This article develops the idea that the three basic theories of inflation (the monetary, the fiscal and the inertial) complement one another. This interpretation brings about two important policy issues: first, the necessity of done coordination between fiscal and monetary policy; and second, the necessity of the synchronization of antiinflationary measures on demand and cost side to break up the link between the present and past inflation due to the indexation. These question are developed in the context of Brazilian institutional homework, of multiplicity of budgets, formal indexation and a peculiar monetary system. Finally, alternative policies are critically evaluated.

Vol.5, n.o4(20), 1985
Fatores aceleradores, mantenedores e sancionadores da inflação: um teste de evidência empírica para o Brasil
Neio Lúcio Peres Gualda

The objective of this paper is to test empirically the theoretical formulation of Bresser Pereira & Nakano’s article, “The accelerating, maintaining and sanctionating factors of inflation” (1984). The empirical test supports the results of their theoretical study. The role of the distributive conflict as a maintaining factor in the inflation process stands out since past inflation creates strong downward price rigidity. Another hypothesis that was shown to be consistent refers to the character of money as it represents an endogenous variable iii the system.

Vol.12, n.o3(47), 1992
Economia e instituições no Governo Kubitschek
Newton Paulo Bueno e José Heleno Faro

This paper seeks to incorporate one of the most recent theoretical progresses in institutional economics to the analysis of the institutional evolution of Brazil during the period 1956/1961: an endogenous rational choice model for institutional dynamics. The Kubitschek period was chosen because it was a moment of our recent history where it was tried to implement significant institutional changes in our political, economical and social institutions seeking to accelerate the rhythm of the industrialization process. The institutions implanted however did not present the self-reinforcement property nor in the weak sense, nor in the strong sense (terms defined in the paper), being for this subject to be undermined by endogenous processes. This institutional arrangement therefore, that was initially capable to sustain itself in conditions of fast industrialization with relative stability of prices, was progressively weakened, becoming self - enforceable only in conditions of economic stagnation and accelerated inflation. It is argued finally that the analysis outlined above can be useful to understand a little better the general nature of the processes of institutional change.

Vol.24, n.o1(93), 2004
Indexação, política de taxa cambial e efeitos da realimentação inflacionária na america latina
Paul D. McNelis

This paper examines inflationary adjustment processes in Argentina, Brazil, Chile, Ecuador, Peru, and Uruguay with time-varying estimation techniques to determine the relationship between inflationary inertia or feedback effects from past to current inflation and the degree of indexation of wages and exchange rates to past inflation rates. Thc results show that reductions iii the degree of exchange rate linkage to past inflation have not been particularly helpful in larger or relatively more diversified economies (such as Argentina, Brasil, or Chile), while reductions in wage linkages to past inflation rates have had strong but short-lived effects.

Vol.6, n.o4(24), 1986
Déficit e financiamento do setor público brasileiro: 1983-1988
Paulo Nogueira Batista Jr.

This article analyses the evolution of the Brazilian public sector’s deficit and of its sources of financing from 1983 to 1988. It is shown that the government’s growing financial problems arose, to a certain extent, from a sharp reduction in its primary surplus from 1985 on. But this was partly compensated by a substan-tially lower interest burden. As a result, there was no explosive increase in the operational deficit up to 1988. The public sector’s increasing financial difficulties resulted basically from a significant narrowing of the supply of credit, a process that began with the external debt crisis and that was reinforced by the effects of accelerating inflation combined with increasing doubts concerning the govern-ment’s creditworthiness.

Vol.10, n.o4(40), 1990
Ajustamento das contas públicas na presença de uma dívida elevada: observações sobre o caso brasileiro
Paulo Nogueira Batista Jr.

This article examines the obstacles to public sector adjustment arising from the existence of a high level of government debt in the form of short-term or floating interest rate obligations. ln this context, adjustment programmes that rely exclusively on increases in taxation and/or reductions in non-financial government expenditures have limited possibilities of success. Besides making the budget highly vulnerable to increases in external and internal interest rates, the size and composition of Brazilian public debt severely restrict the effectiveness of monetary and exchange-rate policies. The article concludes that under present circumstances a successful stabilization programmer would have to involve fiscal adjustment, a shock treatment against inflation and a restructuring of government debt.

Vol.9, n.o4(36), 1989
A condução da política monetária durante o plano cruzado
Pedro Bodin de Moraes

This article analyses monetary policy during the Cruzado Plan. It is argued that the establishment of the overnight interest rate at very low level (around 15%/year) was one of the main factors behind the quick appearance of excess of demand in almost all markets. This excessively slacken monetary policy was the result of the government’s decision of transforming indexated public bonds into bonds with a fixed value, assuming that future inflation would be zero. The monetary policy of the Cruzado Plan is compared to the policies adopted in Argentina in the first months of the Austral plan, and lii Israel from July 1985 on. This comparison reveals that in both cases the process of remonetization of the economy was done much more gradually than iii Brasil, and that iii both countries there was not excess demand in the initial phase of the price freeze.

Vol.10, n.o2(38), 1990
A note on Growth, Welfare and public policy
Pedro Cavalcanti Ferreira

In this note the growth and welfare effects of fiscal and monetary policies are investigated in four economies where public investment is part of the productive process. It is shown that growth is maximized at positive levels of income tax and inflation but that there is no direct relationship between government size, productivity and growth or between inflation and growth . However, unless there are no transfers, no political conflict or public goods in the economy, maximization of growth does not imply welfare maximization and the optimal tax rate and government size are greater than those that maximize growth. Money is not superneutral and the optimal rate of money creation is below the maximizing rate of growth.

Vol.21, n.o1(81), 2001
Múltiplos equilíbrios
Persio Arida

The note is the second of a series of four notes written for students on current policy debates. It focuses on a simple open economy model in which there is a subjective default probability on domestic debt. Under certain conditions there is more than one pair interest/exchange consistent with a given inflation target. Dynamics is explored under a simple behavior rule according to which Central Bank increases interest if inflation is above target. The effect of credible fiscal tightening, external shocks in interest rates or sovereign debt and expected changes in the convertibility regime are discussed.

Vol.22, n.o3(87), 2002
Como evitar uma inflação galopante. Um método novo e simples: uma moeda secundária
Peter Hilferding

A plan to combat inflation, specially the galloping inflation, is stated in this paper through a simples method which, using a combination of the income policy and a very moderate restriction of demand, consists in the introduction of a new currency or the price-stable “secondary cur-rency”. After its introduction, the prices and the principal incomes should be frizzed. According to the author, the success of this plan, for any country, will depend on the obedience to important requirements about its budgetary deficit and current account deficit.

Vol.6, n.o1(21), 1986
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
Distribuição de renda no Brasil: avaliação das tendências de longo prazo e mundanças na desigualdade desde meados dos anos 70
Régis Bonelli e Lauro Ramos

The paper analyses the Brazilian size distribution of income with the objective of identifying to what extent economic policies, macroeconomic performance and changes in the structure of the labor force are related to inequality. There is evidence of long term increases in inequality, especially between 1960 and 1970. Long term trends do not seem to be affected by economic performance, although the stagnation of the 1980s has led to absolute income losses for all individuals except those in the top percentile. Short term behavior, on the other hand, seems to have been influenced by economic performance: there is evidence that growth enhances equity, whereas high inflation has the opposite effect. A decomposition analysis highlights the importance of education in explaining inequality, but points to changes in the structure of the labor force as the major factor in accounting for changes in inequality since the mid-1970s.

Vol.13, n.o2(50), 1993
O real e seu imaginário
Renato Janine Ribeiro

This paper examines the symbolic character of the Brazilian new currency, the Real, whose name suggests its ambition of not only represents a value, but to be the reality itself Also the utilization of natural pictures instead of historical ones on the stamp of the new bills points the wish of giving the character of reality to the currency launched in 1994, meanwhile shows the inflation as product of a disordered imagination. Therefore, the new currency symbolic representation matchs very well to the political discourse that sustains the Real.

Vol.16, n.o2(62), 1996
A polítical economy model of monetary policy: decentralized decision making and competiton for seigniorage
Ronald Hillbrecht

A political economy model is developed to provide a rationale of monetary policy in high inflation regimes, such as the Brazilian experience until the advent of the Plano Real. Decision making of monetary policy is assumed to be decentralized, where several decision-makers competitively determine the quantity of money. It is shown that equilibrium inflation is higher than under the alternative monetary regime where decision making is centralized at the Central Bank. An important additional feature of this political economy model is that it does not rely on time-inconsistency to generate high and sub-optimal inflation.

Vol.19, n.o4(76), 1999
Imposto inflacionário e transferências no Brasil
Rubens Penha Cysne

The paper provides historical data of inflationary tax and inflationary transfers to commercial banks in Brazil

Vol.14, n.o3(55), 1994
Imposto inflacionário e transferências inflacionárias no Brasil: 1947-2003
(Inflationary tax and inflationary transfers in Brazil: 1947-2003)
Rubens Penha Cysne e Paulo C. Coimbra-Lisboa

Este trabalho atualiza, para 2003, a série de taxas inflacionárias de 1947-1992, transferências inflacionárias para bancos comerciais e transferências inflacionárias totais anteriormente publicadas em Cysne (1994) e em Simonsen e Cysne (1995). 

This work updates, to 2003, the 1947-1992 series of inflation tax, inflationary transfers to commercial banks and total inflationary transfers previously published in Cysne (1994) and in Simonsen and Cysne (1995).

Vol.24, n.o4(96), 2004
Estratégias de estabilização: Peru
Rudiger Dornbusch

Written just before the new president of Peru, Alberto Fujimori, takes the position, this article incorporates the necessity of banish the populism and take emergencial measures toge-ther with long-run measures in order to obtain an effective stabilization of the economy. It emphasizes what could be considered consensus among the economists from countries that have experienced chronic inflation: equilibrium of budget deficit, shock therapy, necessity of income policy. It is conc1uded that in spite of the costs of an adjustment to be done, the less privileged classes will suffer much less than in continuous inflationary context.

Vol.11, n.o1(41), 1991
Tratamento da correção monetária dos juros da dívida interna
Sílvio Rodrigues Alves

The aim of this paper presented at the National Accounts Seminar that took place in Buenos Aires, Argentina, November 1988, is to defend the viewpoint that, in the same way as the amortizations payments don’t represent part of the public sector debt, the monetary correction of the debt and other similar charges shouldn’t be con-sidered as part of this deficit. This assertion should be even more emphasized in the case of countries with high inflation rates where expenditures with monetary indexation and other similar charges became, progressively, a bigger share of the Gross Domestic Product. Regarding to a better understanding of the Government real financial situation, an adjustment was done at the national accounts series. In this sense, and in order to work out the fiscal policy, the amount corresponding to the monetary correction was excluded from the expenditure of domestic debt charges. This meant that mone-tary indexation in a context of high inflation rates is better classified as principal rather than debt charge. It is important to note that this paper is based on a previous one, also by Sílvio Rodrigues Alves, entitled “O Desafio do Deficit Público”, published in Revista de Economia Política n.0 30 (April-June/1988). Afterwards, in June 1988, the same viewpoint was defended by Mr. Blezer, Mr. Tanzi and Mr. Teijeiro in the paper “The Effects of Inflation on the Measurement of Fiscal Deficits” (Occasional Paper 59, International Monetary Fund, Washington, D.C., June 1988).

Vol.9, n.o3(35), 1989
Reforma monetária e fiscal para o combate a inflação no Japão pós-segunda guerra mundia (1945-1951)
Silvio Yoshiro Mizuguchi Miyazaki

This paper analyses the Japanese inflationary process occurred in the period after the World War II, between 1945-1950, its causes and the policies of stabilization, monetary and fiscal reforms. Initially, it analyses the factories that increased the price level. The measures adopted to revert this process were divided into two subperiods: phase 1 (between 1946-1948) and phase 2 (between 1949-1951). Those economic policies and reforms resulted in an economic stabilization.

Vol.12, n.o4(48), 1992
Metas inflação: lições da era Greenspan
Simone Silva de Deos e Rogério P. de Andrade

Inflation targets: lessons from the Greenspan era. This paper approaches the experience of monetary policy in the Greenspan period and suggests what lessons could be learnt. The adoption of inflation targeting would denote a step backward in the policymaking process in the USA, for, since the 1980s, a distinctive feature is flexibility of response to adjust to unexpected events and changing environments. The Fed was able to exercise an informed judgement in critical situations and this opens the case for the importance of not restraining policymakers’ actions through the adoption of tight rules. Furthermore, that the various experiences with inflation targeting are indisputably huge successes, and that this framework represents the state of the art (therefore nothing else can alternatively be done), remains to be seen.

Vol.29, n.o3(115), 2009
Escaping the debt constraint on growth: a suggested monetary policy for Brazil
Thomas I. Palley

Existing interest rates imply explosive debt dynamics for Brazil. It also faces rising inflation from earlier currency depreciations, which could trigger future depreciation. These conditions impose a policy contradiction. Brazil needs lower interest rates for debt sustainability, but tight monetary policy to avoid exchange rate depreciation and inflation. The paper develops a strategy to escape this contradiction. Policy must bolster investor confidence to lower external interest rates, lower domestic interest rates to reduce debt service burdens, and implement domestic credit creation controls to control inflation.

Vol.24, n.o1(93), 2004
A inflação brasileira e a teoria dos jugos
Uwe Haneke

Based on the disaggregation of the private sector as an amplification of the well-known Barro & Gordon policy-game model, a coordination and/or cooperation problem of the price-setters in the private sector is identified as a possible cause for the persistence of inflation even during stabilization efforts. This kind of persistence is, at least in the short-term, independent from the willingness of the government to stop inflation. A process of self-fulfilling prophecies is started by the “wait-and-see” behavior of private sector’s price-setters, which can result in the giving up of the stabilization policy. Breaking this “wait-and-see” behavior could be one of the major problems in stabilizing economies with chronic high inflation.

Vol.15, n.o4(60), 1995
Inflation Adjusted nominal déficit: a note on Robert Barros definition
Viviane Luporini

This note discusses the concept of ‘inflation adjusted nominal deficit’ proposed by Robert Barro in light of a stock-flow consistent real deficit. It is argued that the calculation proposed by the author violates the principle of stock-flow consistency and leads one to the erroneous interpretation that a rise in the rate of inflation decreases the government deficit in nominal terms.

Vol.23, n.o1(89), 2003
A retomada da inflação no Brasil: 1974-1986
Werner Baer

From 1974-1985 the Brazilian inflation rate showed a tendency to grow as opposed to the decli-ning tendency observed in the 1964-1973 period. The causes of this resurgence of inflation, its impact, and the policies used to control it are analyzed in this work, using two-approaches which result from two different schools of thought: the “classical orthodox tradition” which sees infla-tion as being caused by excessive increases in the money supply; and the “neo-structuralist school for which inflation is considered basically the result from the monopoly power of corporations, trade unions, and the state, culminating in the concepts of inertial inflation. The failure of orthodox school in both its diagnosis and its inflationary control policies led to author to conclude, through an analysis of the institutional structure of Brazil, and the conduct of its components that the neo-structuralist explanation come closer to the root of the problem, advocating the need to adopt “heterodox” policies. The author also presents a preliminary evaluation of the “Cruzado Plan” — the program of economic stabilization — inspired by neo-structuralist ideas, which was implemented in Brazil on February 28, 1986.

Vol.7, n.o1(25), 1987
Metas de Inflação, taxa de câmbio real e crise externa num modelo Kaleckiano
Alexandre Souza, Gabriel Porcile e Ricardo Viana

Inflation target, real exchange rate and external crisis in a Kaleckian model. Which role should the real exchange rate play in an inflation target regime? In this paper this point is discussed from the point of view of the conditions required for avoiding an external crisis. With this objective, a dynamic Kaleckian model is presented focusing on the stability of the external debt to capital ratio. The main conclusion is that policy makers should monitor closely the evolution of the real exchange rate in order to make compatible the inflation target regime with external stability.

Vol.31, n.o4(124), 2011
The Banco Central do Brasils institutional framework after ten years
Emmanuel Carré

The Banco Central do Brazil (BACEN) adopted inflation targeting in 1999. This monetary policy regime originates in institutional design which remains crucial today for the expectations management, and is in permanent evolution. After 10 years, the BACEN institutional framework is assessed, asking if there is still room for improvement. Various institutional procedures are analysed, and lessons are drawn from the international experience of a panel of sixteen countries. Some proposals for the BACEN institutional framework are made.


Vol.31, n.o4(124), 2011
Metas de inflação, regra de Taylor e neutralidade da moeda: uma crítica Pós-keynesiana
Mariana de Lourdes Moreira Lopes, Maria de Lourdes Rollemberg Mollo e Fabiana Silvio Colbano

Inflation targeting, Taylor rule and money neutrality: A post-Keynesian critic. This paper critically discusses the inflation targeting regime proposed by orthodox economists, in particular the Taylor Rule. The article describes how the Taylor Rule assumes the argument of money neutrality inherited from the Quantitative Theory of Money. It discusses critically the ways of operation of the rule, and the negative impacts of the interest rate over the potential output. In this sense, the article shows the possible vicious circles of the monetary policy when money is not neutral, as is the case for post-keynesian economists. The relation of interest rates, potential output and the output gap is illustrated in some estimates using the methodology of Vector Auto-regressive in the Brazilian case. 

Vol.32, n.o2(127), 2012
Quinze anos de rigidez monetária no Brasil pós Plano Real: uma agenda de pesquisa
André de Melo Modenesi e Rui Lyrio Modenesi

Fifteen years of monetary inflexibility in Brazil after the Real Plan: a research agenda.The paper makes a review of literature and a research agenda on the anomaly of Brazilian monetary policy. Following a retrospect of the first 15 years after the Real Plan, there is a review of studies aiming to explain the high real interest rate. None of the summarized theses can completely explain the phenomenon. The main research opportunities are: deepening of empirical evidence of monetary policy efficacy loss; improvement in mensuration of its inefficacy; and improvement of alternative instruments to control inflation. The field of political economy is also fertile. One should assess the relevance of oligopolies as an explaining factor of persistence of high inflation. 

Vol.32, n.o3(128), 2012
Exchange rate pass-through inflation and wage differentials in late-industrializing economies: the Mexican case
Teresa S. Lópes, Quadalupe Mantéy e Luis Quintana

This paper investigates exchange rate pass-through inflation, and the wage bargaining process, in a developing economy in which firms’ market power is largely dependent on technical progress embodied in imported intermediates and capital goods. It develops a heterodox model of income distribution, based on theoretical contributions from Latin American structuralists, labor market segmentationists and post-Keynesian writers, and it presents supportive empirical evidence from the Mexican economy. 

Vol.32, n.o4(129), 2012
Teoria das finanças funcionais e o papel da política fiscal: uma crítica pós-keynesiana ao novo consenso macroeconômico
Gabriel Caldas Montes e Rômulo do Couto Alves

Theory of functional finance and the role of fiscal policy: A post-keynesian critique to the new consensus macroeconomics. This paper presents the critical approaches and elaborates the arguments that oppose those of the New Consensus Macroeconomics regarding the conduct of fiscal policy. Those criticisms and arguments are based in the Post-Keynesian thought and the theory of Functional Finance. The theory of Functional Finance is an extension of the Keynesian approach, particularly with regard to discussions on public finances. As supports the theory of Functional Finance, the objectives to be pursued by fiscal policy should suggest the improvement of social welfare as a whole, i.e., the performance of inflation, employment and output should be taken into account by policymakers. 

Vol.32, n.o4(129), 2012
Competitividade e restrição externa na Zona do Euro
André Sander Diniz e Frederico G. Jayme Jr.

Competitiveness and external constraint in the Eurozone. The recent debt crisis in Greece, Ireland and Portugal has exposed the fragility existing in the Euro zone for promoting development and economic convergence between the countries that have adopted the currency. Way beyond the fear of insolvency, what is observed is a growing disparity of the most-developed countries in comparison to the less-developed ones, with perverse consequences for the last ones. Once the nominal exchange rates are fixed, the divergent movements in relative prices and wages between the countries have led to totally distinct paths for the real exchange rates. Worsening the scenario, one can observe the incompleteness of the political union, the monetarist focus of the ECB and the lack of labor mobility between the countries, what distances from the argument stated by the theory and puts in jeopardize the future of the Monetary Union. 

Vol.33, n.o1(130), 2013
A note on the Pazos-Simonsen mechanism and Kaldor s early research on Latin American inflation
Leonardo Vera

In contrast with the inflationary finance story, inflation acceleration in Latin America has been explained as the result of the interaction of inflation dynamics and the frequency of wage adjustments. Accordingly, small inflation disturbances are connected with a shift from moderate to high inflation (or beyond to hyperinflation) trough a mechanism that makes adjustment intervals in wage contracts endogenous. Rudiger Dornbusch (1986) labeled this process the “Pazos-Simonsen mechanism.” In this note we summarize the basic contribution of both Felipe Pazos (1978) and Mario Henrique Simonsen (1983) and find crucial differences between their views on wage dynamics, specifically regarding the endogeneity of the time interval between wage readjustments. A remarkable affinity with Pazos’s view on wage dynamics and inflation is found in an early and almost unknown essay written by Nicholas Kaldor in 1957 (inspired in his brief experience in Latin America). 

Vol.33, n.o2(131), 2013
Convenções financeiras e a taxa básica de juros no Brasil: uma primeira aproximação
Luciana Seabra e David Dequech

Financial conventions and basic interest rate in Brazil. This article discusses the thesis that the Brazilian interest rate is a convention, focusing on the basic interest rate under the inflation targeting regime. On the one hand, there are some complications involved in this debate. In order to show this, we consider the theoretical works that have been references for the Brazilian economists who see an interest rate convention in the country. On the other hand, despite the difficulties, it is possible to find signs of conventionality in the determination of the Brazilian basic rate, by analyzing two properties of conventions: conformity of some with the conformity of others; and arbitrariness. 

Vol.33, n.o4(133), 2013
Mário Henrique Simonsen e a construção do conceito de inflação inercial
Andrea Felipe Cabello

Mário Henrique Simonsen and the construction of the concept of inertial inflation. The paper analyzes the contributions of Mario Henrique Simonsen to the construction of the concept of inertial inflation and to its connected literature. Simonsen’s curve, in which the idea of inertial inflation was implicit, is analyzed, alongside with the feedback model (modelo de realimentação) and it’s shown how Simonsen built a model which considered inflationary inertia, neutralization possibilities and possible problems and costs of stabilization, anticipating many of the issued that guided the debate in the 1980s. 

Vol.34, n.o2(135), 2014
O centenário de Ignácio Rangel
(The centenary of Ignácio Rangel)
José Maria Dias Pereira

Este artigo tem como objetivo sintetizar os principais pontos de sua obra, considerando que sua contribuição teórica é pouco conhecida das novas gerações. Foi um dos primeiros a associar os ciclos internos da nossa economia aos ciclos da economia mundial através da tese da dualidade. A inflação fazia parte da "síndrome da recessão". Fora da recessão, deve haver transferência de recursos de atividades com capacidade ociosa para setores atrasados, no caso de serviços públicos. 

This article aims to summarize the main points of his work, considering that his theoretical contribution is poorly known of the new generations. It was one of the first to associate the internal cycles of our economy to the cycles of the world economy through the thesis of duality. Inflation was part of the "syndrome of the recession." Out of recession, there should be transfer of resources from activities with idle capacity for latecomers sectors, in case public services. 

Vol.34, n.o4(137), 2014
A curva de Rangel: origem, desenvolvimento e a formalização de Bresser-Pereira e Nakano
(The Rangel curve: origin, development and formalization of Bresser-Pereira and Nakano)
Osmani Pontes Moreno e André de Melo Modenesi

Para Rangel, a inflação é causada por oligopólios e é necessária porque impede uma depressão em uma economia com baixa propensão a consumir. Enfrentando a inflação, o governo imprime dinheiro para evitar uma crise de liquidez. Essa concepção implica uma dupla oposição ao pensamento monetarista: concebe a inflação como fenômeno funcional e reverte a causalidade estabelecida pela equação quantitativa. Bresser e Nakano foram altamente influenciados por Rangel e enfatizam que a inflação é causada por oligopólios e também propõem um “papel sancionador” do Estado. No entanto, esses autores vão mais longe, argumentando que, na recessão, a inflação se acelera, formalizando uma relação negativa entre o crescimento do PIB e a inflação, de acordo com a chamada “curva de Rangel”. 

For Rangel inflation is caused by oligopolies and is necessary because it prevents a depression in an economy with low propensity to consume. Facing inflation, government prints money to avoid a liquidity crisis. This conception implies a double opposition to monetarist thought: conceives inflation as functional phenomenon and reverses the causality established by the quantitative equation. Bresser and Nakano were highly influenced by Rangel and stress that inflation is caused by oligopolies and also propose a “sanctioning role” of the state. However, these authors go further Rangel arguing that in recession inflation accelerates thus, formalizing a negative relationship between GDP growth and inflation, according with the so called “Rangel curve”. 

Vol.34, n.o4(137), 2014
Institutions, credibility and crisis: the inconsistencies of Argentine exchange rate policy (1991-2006)
Nicolás Cherny

 The purpose of this article is twofold. The first is to explain the time inconsistencies of the convertibility regime that led to the 2001 crisis. The argument suggests that the credibility requirements for convertibility induced a dynamic of legal, fiscal, financial and external commitments that increased exit costs and time inconsistencies. The second objective is to explain the tensions of the floating regime that replaced convertibility in 2002. We describe the effects of a floating exchange rate on macroeconomic imbalance and the growing tension between competitiveness and inflation.

Vol.35, n.o1(138), 2015
Preços administrados e discricionariedade do executivo
(Administered Prices and Government Discretion)
Paulo Furquim de Azevedo e Felipe C. Serigati

Durante o primeiro mandato da presidente Dilma, os preços administrados foram utilizados como um instrumento para cumprir a meta de inflação, de modo a subordinar as políticas industriais para finalidades macroeconômicas de curto prazo. Esta estratégia foi ineficaz para controlar a inflação e distorceu decisões de investimento e consumo. O artigo mostra que os preços tendem a desviar-se mais, quanto maior for seu peso no índice de preços, e tendem a variar de forma consistente com os ciclos políticos. O artigo conclui com sugestões de políticas para controlar o efeito negativo de desvios de critério do governo para determinar os preços administrados. 

Administered Prices and Government Discretion. Administered prices during the first term of President Dilma were used as an instrument to meet inflation target, so as to subordinate industrial policies to short run macroeconomic aims. This strategy was ineffective to control inflation and distorted investment and consumption decisions. The article shows that prices tend to deviate more the larger their weight in the price index, and tend to vary consistently with the political cycles. The article concludes with policy suggestions to control the negative effect of deviations of government discretion to determine administered prices.

Vol.35, n.o3(140), 2015
Fiscal costs of monetary policy: indirect effects of an interest rate shock on Brazilian public net debt
(Custos fiscais da política monetária: os efeitos indiretos de um choque de juros sobre a dívida líquida do setor público)
Laura Carvalho, André Diniz, Ítalo Pedrosa e Pedro Rossi

 O artigo estima o custo fiscal de um aumento da taxa básica de juros da economia considerando não apenas os efeitos diretos sobre a remuneração dos títulos indexados à SELIC, mas também os efeitos indiretos que incidem sobre: (i) a remuneração dos títulos públicos indexados ao câmbio e à inflação; e (ii) o estoque da dívida líquida do setor público, através do ajuste patrimonial das reservas internacionais. As projeções se baseiam na estimação da relação entre taxa básica de juros, taxa de câmbio e inflação a partir de um modelo de vetores autor regressivos. Conclui-se que os efeitos indiretos têm impacto indeterminado sobre a taxa de juros implícita da dívida pública quando não se considera o ajuste no valor das reservas internacionais ocasionado pelo impacto da SELIC na taxa de câmbio. A inclusão desse efeito patrimonial pode amplificar substancialmente o custo fiscal de uma política monetária restritiva, indicando a necessidade de uma maior articulação entre as políticas monetária, fiscal e cambial no Brasil.

 The paper estimates the fiscal cost of an increase in the Brazilian policy interest rate – the SELIC – by considering not only the direct effect on the yield of public bonds that are indexed to the SELIC, but also indirect effects on: (i) the yield of public bonds that are indexed to the exchange rate and inflation, and (ii) the stock of public net debt through adjustments in the value of international reserves measured in domestic currency. Projections are based on the estimation of the relationship between interest rates, exchange rates and inflation by means of a vector auto-regression. We conclude that the inclusion of such indirect effects has an ambiguous effect on the response of the implicit interest rate on public net debt to shocks in the SELIC, when adjustments in the value of international reserves are not considered. However, the inclusion of the latter amplifies the fiscal cost of a more restrictive monetary policy. These results call fora better coordination between monetary, fiscal and exchange rate policies in Brazil.

Vol.36, n.o3(144), 2016
Monetary policy in the post Keynesian theoretical framework
(A política monetária na perspectiva pós-Keynesiana)
Philip Arestis e Fábio Henrique Bittes Terra

O objetivo desta contribuição é desenvolver um modelo pós-keynesiano de política monetária, apresentando seus objetivos, instrumentos e canais de transmissão. A originalidade desta contribuição consiste, seguindo-se as propostas de Keynes (1936, 1945), em se instituir a administração de dívida como um dos instrumentos da política monetária, em conjunto com os tradicionais, taxa de juros e regulação. Ademais, o artigo constrói seu modelo teórico resgatando amplamente os escritos originais de John Maynard Keynes. Um modelo de política monetária erigido desta forma relaciona-se diretamente aos esforços pós-keynesianos de oferecer uma forma de condução da política monetária que seja alternativa ao Regime de Metas de Inflação, proposto pelo Novo Consenso Macroeconômico.

The purpose of this contribution is to develop a Post Keynesian monetary policy model, presenting its goals, tools, and channels. The original contribution this paper develops, following Keynes’s (1936, 1945) proposals, is the use of debt management as an instrument of monetary policy, along with the interest rate and regulation. Moreover, this paper draws its monetary policy model by broadly and strongly relying on Keynes’s original writings. A monetary policy model erected upon this basis relates itself directly to the Post Keynesian efforts to offer a monetary policy framework substantially different from the Inflation Targeting Regime of the New Macroeconomic Consensus

Vol.37, n.o1(146), 2017
Dinâmica recente da inflação brasileira em ambientes distintos de expectativas forward-looking
(Recent dynamics of Brazilian inflation in different environments of forward-looking expectations)
Elano Ferreira Arruda, Maria Thalita Arruda Oliveira e Ivan Castelar

 Este estudo analisa como a inflação brasileira recente responde aos ciclos econômicos e ao seu componente inercial considerando ambientes distintos de expectativas forward-looking no arcabouço da Curva de Phillips Novo Keynesiana Híbrida (CPNKH). Para tal, faz-se uso de informações mensais entre janeiro de 2002 e agosto de 2015 e estimações de GMM-HAC da CPNKH. Os resultados sugerem que a inflação brasileira ainda possui um forte componente inercial e que, em um ambiente de menor previsibilidade dos agentes, a inflação se mostra mais sensível às oscilações cíclicas da atividade econômica. Por fim, observou-se um repasse cambial positivo e significante para a inflação brasileira.

 This work analyzes how the recent Brazilian inflation responds to economic cycles and its inertial component considering different environments of forward-looking expectations in the framework of the Hybrid New Keynesian Phillips Curve (HNKPC). To do this, use is made of monthly data from January 2002 to August 2015 and GMM-HAC estimates of the HNKPC. The results suggest that Brazilian inflation still has a strong inertial component and that in an environment of lower predictability of economic agents, inflation seems to be more sensitive to cyclical fluctuations in economic activity. Finally, It was observed a positive and significant pass-through exchange rate to inflation in Brazil. 


Vol.37, n.o4(149), 2017
Estabilidade monetária e CEPAL: A heterogeneidade do pensamento estruturalista Latino-Americano
(Monetary stability and ECLAC: the heterogeneity of developmental structuralist doctrime of Latin America)
Pedro Luiz Aprigio e André Roncaglia de Carvalho


O artigo verifica a hipótese de homogeneidade estrita do pensamento estruturalista Latino-Americano em matéria de estabilidade monetária em seus anos iniciais. Em meados da década de 1950, o crescente e contínuo fenômeno inflacionário na região era explicado pela CEPAL como resultante da presença de estrangulamentos nas estruturas reais da economia. Entretanto, o canal de transmissão ao nível de preços é explicado pelos autores de maneiras diversas, gerando-se, por conseguinte, diferentes propostas de estabilização. O artigo sublinha a flexibilidade metodológica e o grau de fragmentação teórica da abordagem cepalina, bem como a controvérsia sobre a inflação constituir parte do processo de desenvolvimento. A análise destes elementos revela uma tensão entre os aspectos keynesianos anglo-saxônicos na abordagem de Prebisch e a original teoria latino-americana proposta por Noyola e Furtado. Avalia-se em que medida este descompasso impediu a constituição de um corpo teórico diferenciado em matéria de estabilização monetária.


The paper evaluates the assumption of a homogeneous theory of monetary stabilization in early Latin American structuralist economics. Starting in the 1950s, the growing and continuous inflationary problem in the region was seen as a result of bottlenecks within the productive structure. However, the channels that transmit such imbalances onto prices are framed quite distinctly amongst the aforementioned writers, with implications regarding their policy suggestions. The paper underlines a methodological flexibility, which engendered a fragmented theoretical framework of analysis, and the notion that inflation was part of the process of economic development. The combination of both elements unveiled an analytical deficiency within Cepal’s theory of monetary stabilization. As a result, there arose a tension between Prebisch’s Anglo-Saxon Keynesian view and the original theory proposed by Noyola and Furtado. The paper traces the nature of such disparities and the extent to which they impaired the constitution of a unique theoretical corpus on matters of stabilization.


Vol.38, n.o1(150), 2018
Ideologia em estado puro: Juros e inflação para além da aparência neoclássica
(Ideology on pure state: Interest and inflation beyond the neoclassical appearance)
Jorge Armindo Aguiar Varaschin


Há uma crença em parcela dos/as economistas brasileiros/as alusiva à possibilidade de análises econômicas que excluam influências ideológicas. A ortodoxia neoclássica funda sua pretensão científica apoiada na premissa de sua própria neutralidade, influindo no debate econômico nacional: o não reconhecimento de seu caráter ideológico, conforme esvazia de significação conceitos centrais como a inflação, interdita a discussão da qual faz parte. Este trabalho investiga esse deslocamento de conteúdo, cuja síntese manifesta-se através da temática inflacionária, apresentando esse “vazio” conceitual como momento de perda de sua eficácia analítica, mas que, justamente por isso, redimensiona seu papel como veículo ideológico.


There is a belief amongst part of Brazilian economists alluding to the possibilities of economic analysis which excludes ideological influences. The neoclassical orthodoxy establishes its scientific pretentions based on the premise of its own neutrality, influencing the national economic debate: the not recognizing of its ideological character, as it drains significant focal concepts such as inflation, inhibits the discussion from which it belongs. This essay queries such content shift, which synthesis prompts through the inflationary thematic. Featuring this conceptual “void” as moment of loss from its analytical efficacy, though, because of it, resizes its part as ideological mean.

Vol.38, n.o1(150), 2018
Revisitando o debate inercialista da inflação brasileira
(Revisiting the inercialist debate of Brazilian inflation)
Hugo Carcanholo Iasco Pereira e Marcelo Luiz Curado

 O objetivo deste artigo foi investigar as teorias da inflação inercial representadas pelas versões dos autores da PUC-RJ e da FGV-SP em uma perspectiva comparada, enfatizando os elementos teóricos comuns e como isto se materializou nas propostas de estabilização para a economia brasileira. Embora exista um background comum às teorias, com rigor analítico, elas são substancialmente diferentes, constituindo estratégias de estabilização bastante díspares. Concluiu-se que o inercialismo não pode ser considerado um corpo teórico uniforme, sobretudo no tocante a ruptura com a ortodoxia e a concepção monetária, conflito distributivo e plano de estabilização e o imperativo de neutralidade distributiva.

The aim of this paper was to investigate the inertial inflation’s theory represented by the versions of economists from PUC-RJ and FGV-SP, emphasizing the theoretical elements present in each and how it materialized in the stabilization proposals for the Brazilian economy. Although there is a common background, the theories are substantially different. The conclusions suggested that the inercialist theories can’t be considered a uniform theoretical framework, especially with respect to break with orthodoxy and monetary conception, distributive conflict and stabilization’s plan and the necessity of neutrality distributive. 


Vol.38, n.o3(152), 2018
Composição dos Juros Líquidos Pagos pelo Setor Público no Brasil: 2002-2017s
(Composition of net interest payments of the Brazilian Government: 2002-2017)
Nelson Henrique Barbosa-Filho

Este artigo apresenta uma metodologia de decomposição dos juros líquidos pagos pelo setor público brasileiro em cinco itens: juros reais, correção monetária, swaps cambiais, custo da carteira financeira do governo e efeitos de segunda ordem. O artigo também apresenta outra metodologia com adição da senhoriagem à lista inicial. Os dados brasileiros indicam mudanças importantes na composição dos juros líquidos nos últimos 15 anos, com redução dos juros reais de 2009 de 2015, e elevação a partir de então. Os dados também mostram que o custo financeiro da carteira do governo subiu significativamente a partir de 2006, devido à acumulação reservas internacionais pelo Banco Central e empréstimos da União ao BNDES. 

This paper presents a methodology to decompose the net interest payments of the Brazilian government in five items: real-interest payments, inflation adjustment, exchange-rate swaps, financial cost of the government’s portfolio and second-order effects. The paper also presents an alternative methodology in which seigniorage is added to the initial list. The Brazilian data show important changes in the composition of the net interest paid in the last 15 years, with a reduction in real-interest payments in 2009-15, and an increase since then. The data also show that the financial cost of the government’s portfolio grew substantially since 2006, due to the accumulation of international reserves by the Central Bank and the government’s loans to its national development bank (BNDES). 


Vol.38, n.o3(152), 2018
Dinâmica inflacionária da indústria brasileira: uma abordagem setorial (1999-2014)
(Dynamics of the Brazilian industrial inflation: a sectoral approach (1999-2014))
Flávia Carvalho de Moraes e Silva, Carmem Feijó e Andre de Melo Modenesi

 O objetivo deste trabalho é investigar o comportamento da dinâmica inflacionária industrial brasileira no período entre 1999 e 2014 à luz das teorias de inflação de custos e da heterogeneidade setorial. Através da teoria de formação de preços pós-Keynesiana e da teoria do conflito distributivo sobre o processo inflacionário, otrabalho aponta para a importância das diferenças na estrutura de custos setoriais para a análise sobre a inflação. Estas diferenças são importantes uma vez que podem levar a reações heterogêneas frente às diferentes pressões inflacionárias. O trabalho busca preencher esta lacuna e integrar as abordagens microeconômica e macroeconômica, de modo a contribuir para o diagnóstico da inflação industrial. Realiza-se um estudo econométrico com dados em painel para estimar os efeitos do impacto de variações nos custos, nos salários, na demanda e nos preços defasados sobre as variações dos preços finais. Encontramos que, levando-se em conta a heterogeneidade setorial, os choques de custos são a principal variável explicativa para a dinâmica inflacionária.

 This paper investigates the dynamics of the Brazilian industrial inflation during 1999-2014. Based on the post-Keynesian theory on price formation and distributive conflict, the paper discusses the importance of sectoral differences for the analysis of Brazilian inflation in the 2000s. These differences are important since they can lead to heterogeneous reactions in the face of different inflationary pressures. Micro and macroeconomic approaches are considered in order to contribute to the diagnosis of Brazilian industrial inflation. An econometric exercise with panel data is conducted to estimate the effects of the impact of changes in costs, wages, demand and lagged prices on changes in final prices. We find that, considering sectoral heterogeneity, cost shocks are the main explanatory variable for the inflation dynamics.


 DOI 10.1590/0101-3157-2018-2863

Vol.38, n.o4(153), 2018
Não-linearidade entre câmbio e preços no Brasil e implicações para uma estratégia de desenvolvimento econômico
(Non-linearity between exchange and prices in Brazil and implications for an economic development strategy)
Mateus Ramalho Ribeiro da Fonseca, Eliane Cristina de Araújo e Elisangela Araújo

O objetivo deste artigo é realizar uma análise da política monetária no Brasil a partir de um modelo de Vetores Autorregressivos com Cadeias de Markov (MS-VAR), na busca de evidências da não-linearidade da relação entre câmbio e preços no Brasil. A análise demonstrou que, em períodos de apreciação cambial, tanto pelo lado da demanda, quanto da oferta, existe um conjunto de forças que determinam uma trajetória baixista para os níveis de preços, sugerindo que a taxa de câmbio tem um papel fundamental no controle da inflação. Contudo, se aponta a necessidade de reavaliação do papel do câmbio no Brasil.

The objective of this article is to perform an analysis of monetary policy in Brazil, using a Markov Chain Autoregressive Vector (MS-VAR) model, in the search for evidence of non-linearity in the relationship between exchange and prices in Brazil. The analysis showed that in periods of exchange appreciation, both on the demand side and the supply side, there is a set of forces that determine a downward trajectory for price levels, suggesting that the exchange rate plays a fundamental role in the control of inflation. However, there is a need to reassess the role of the exchange rate in Brazil.

DOI 10.1590/0101-35172019-2877

Vol.39, n.o2(155), 2019
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