Do Structural Reforms Always Succeed? Lessons from Brazil
WIDER Working Paper No. 2004/X
48 Pages Posted: 12 Sep 2004
Date Written: August 2004
In the last twenty years, Brazil has experienced several attempts of improving sustainable growth through stabilization programs, and more recently, structural reforms in line with the Washington Consensus Agenda. The results, however, have been disappointing, as the per capita output growth has remained below its historic trend, and poverty and inequality remain at high levels. This paper investigates why market-oriented reforms such as trade and capital account liberalization, privatization, deregulation and stabilization failed to boost growth in Brazil. We conclude that structural reforms may contribute to growth if accompanied by microeconomic policies tailor-made to the country's needs, and by appropriate macroeconomic, institutional and political environments.
Keywords: Structural reforms, policy coordination, fiscal policy, stabilization, trade liberalization, political economy, Brazil
JEL Classification: E61, E62, E63, E65, F15, P11, P16
Suggested Citation: Suggested Citation