Sectoral capabilities and productive structure: An input-output analysis of the key sectors of the Brazilian economy

Vol. 36 No. 3 (2016)

Jul-Sep / 2016
Published March 1, 2020
PDF-English
PDF-English

How to Cite

Marconi, Nelson, Igor L. Rocha, and Guilherme R. Magacho. 2016. “Sectoral Capabilities and Productive Structure: An Input-Output Analysis of the Key Sectors of the Brazilian Economy”. Brazilian Journal of Political Economy 36 (3):470-92. https://doi.org/10.1590/0101-31572016v36n03a02.

Sectoral capabilities and productive structure: An input-output analysis of the key sectors of the Brazilian economy

Nelson Marconi
Professor da Escola de Economia de São Paulo, da Fundação Getulio Vargas (EESP/FGV).
Igor L. Rocha
Ph.D. pela University of Cambridge, Reino Unido.
Guilherme R. Magacho
Ph.D. pela University of Cambridge, Reino Unido.
Brazilian Journal of Political Economy, Vol. 36 No. 3 (2016), Jul-Sep / 2016, Pages 470-492

Abstract

The complex relationship between production structure and economic growth has been the subject of considerable debate among Brazilian economists. This debate became especially relevant after the 2000s, when Brazil experienced a period of growth from the rise of commodity exports, which contrasted with the stagnation observed in the previous two decades. To analyse the capacity of commodity exports to generate long-term economic growth, this paper assesses this sector’s performance and its effects on related sectors in the upstream supply chain through input-output tables. These analyses lead to two main conclusions. First, expansion of agricultural and mineral commodities production exhibited little capacity to boost the economy because they have the lowest linkage indices. Second, the analysis of the Brazilian production structure demonstrated that sectors related to manufacturing can stimulate other sectors, such as sophisticated services, because of their high linkage effects on other sectors. This study also demonstrates that a development strategy should take benefit of comparative advantages in order to reach a structural change oriented toward expanding manufacturing.

JEL Classification: C67; L16; O11.


Keywords: manufacturing structural change development strategies input-output models backward and forward linkages