Financial conventions and basic interest rate in Brazil: a first approach

Vol. 33 No. 4 (2013)

Oct-Dec / 2013
Published October 1, 2013
PDF-Portuguese (Português (Brasil))
PDF-Portuguese (Português (Brasil))

How to Cite

Seabra, Luciana, and David Dequech. 2013. “Financial Conventions and Basic Interest Rate in Brazil: A First Approach”. Brazilian Journal of Political Economy 33 (4):599-618. https://centrodeeconomiapolitica.org.br/repojs/index.php/journal/article/view/330.

Financial conventions and basic interest rate in Brazil: a first approach

Luciana Seabra
Luciana Seabra é jornalista do jornal Valor Econômico.
David Dequech
Professor do Instituto de Economia da Universidade Estadual de Campinas — Unicamp.
Brazilian Journal of Political Economy, Vol. 33 No. 4 (2013), Oct-Dec / 2013, Pages 599-618

Abstract

 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.

JEL Classification: B52; E43; E58.


Keywords: conventions Keynes interest rate inflation targets