Recession and interest rates: Brazil in the early 1980s

Vol. 5 No. 1 (1985)

Jan-Mar / 1985
Published January 1, 1985
PDF-Portuguese (Português (Brasil))
PDF-Portuguese (Português (Brasil))

How to Cite

Arida, Pérsio, and André Lara Resende. 1985. “Recession and Interest Rates: Brazil in the Early 1980s”. Brazilian Journal of Political Economy 5 (1):3-18. https://doi.org/10.1590/0101-31571985-1005.

Recession and interest rates: Brazil in the early 1980s

Pérsio Arida
Departamento de Economia, Pontifícia Universidade Católica do Rio de Janeiro. Rio de Janeiro/RJ, Brasil.
André Lara Resende
Departamento de Economia, Pontifícia Universidade Católica do Rio de Janeiro. Rio de Janeiro/ RJ, Brasil.
Brazilian Journal of Political Economy, Vol. 5 No. 1 (1985), Jan-Mar / 1985, Pages 3-18

Abstract

The Brazilian economy faces the deepest contraction in its economic activity of
the last sixty years. The declining output per capita for the period 1980/83 merits comparison
with that of the period 1928/33. Using semi-official, conservative more severe than that
of 1928/33. That current pression was unleashed by growing difficulties in meeting obligations
in foreign exchange is beyond doubt. This article argues that the present form of adjustment
to the external crisis is inadequate. The burden of external debt was needlessly
magnified by policies which erroneously identify the interest rate as the crucial adjustment
variable.

JEL Classification: F34; O40; E61.


Keywords: Recession interest rates debt crisis external debt