Vol. 22 No. 1 (2002): Jan-Mar / 2002

Vol. 22 No. 1 (2002)

Jan-Mar / 2002
Published January 1, 2002


Tropical Neomonetharism: The Brazilian Experience in the Nineties
Alfredo Saad Filho, Lecio Morais
Brazilian Journal of Political Economy

This paper reviews the performance of the Brazilian economy during the 1990s, in the light of the neomonetarist policy shift implemented unevenly but incrementally across this decade. The paper shows that this policy shift was associated with, and contributed to, a change in the structure of manufacturing industry, the financial deterioration of the public sector, the tightening of the balance of payments constraint, and increasing external economic dependence. These structural changes were largely responsible for the currency crisis of 1999. Subsequent policy measures have largely failed to address these weaknesses of the Brazilian economy.

JEL Classification: B24; B51.

Theory and Evidence of the Inflationary Targets Regime
João Sicsú
Brazilian Journal of Political Economy

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.

JEL Classification: E31; E43; E52; E58.

Exchange Rate, Monetary, and Inflation Targets
Helder Ferreira de Mendonça
Brazilian Journal of Political Economy

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 policymakers 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.

JEL Classification: E52; E58.

Productivity, wages, profits, and exchange rates in an era of globalization
Hartmut Elsenhans
Brazilian Journal of Political Economy

World-wide devaluation races lead to the globalization of rent instead of profit and autonomy of civil society. This specific pattern of today's globalization goes with serious underconsumptionist tendencies as self-sufficiency in wage goods production is achieved in economies with a very low marginal product of labour in agriculture and structural unemployment which disempowers all labour. The 19th century likewise intensive globalization was characterized by full employment tendencies, rising real wages and an expansion of the welfare state. A return to such a convoy model of globalization is possible through marginality reducing development policies for uplifting the poor in the South.

JEL Classification: F31; J3.

Governance, accoutability and responsiveness
Sérgio de Azevedo, Fátima Anastasia
Brazilian Journal of Political Economy

In order to analyze the institutionalization of alternative channels of participation in public policy making in the state of Minas Gerais, Brazil, the paper starts from the assumption that the relationship between accountability and responsiveness in the so called “new democracies” basically depends on the institutional design adopted and on its adequacy to the prevailing societal conditions.

JEL Classification: H1.

Investment Models: Methodology and Results
Elton Eustaqui Casagrande
Brazilian Journal of Political Economy

This paper provides an overview of the empirical studies on corporate financing patterns and firm’s investment behavior. In a frictionless world the Modigliani-Miller theorem holds as well as the neoclassical investment theory. However, in presence of imperfections resulting from information asymmetries internal finance is often less costly than external finance. The goal in this article is to show how empirical studies have examined the role of financial constraints and firm’s investment behavior.

JEL Classification: G31.

The Epistemology of Theoretical Economics in Schumpeter
Marcos Fernandes Gonçalves da Silva
Brazilian Journal of Political Economy

The objective of this paper is to reconstruct the main elements of Schumpeter‘s instrumentalist epistemology, in the way as they are exposed in his first published book Das Wesen und der Hauptinhalt der theoretischen Nationalökonomie (1908), which is the main effort developed by the Austrian economist for the analysis of the foundations of the economic science. Firstly, I will reconstruct his instrumentalist epistemology and I will show the importance of the same. This reconstruction is important because the hard core of Schumpeter’s instrumentalist epistemology is the relatively unknown. Finally, I will indicate the direct filiation of the Schumpeter’s instrumentalist epistemology to the main ideas about the nature of mechanics and of the physics in general in the end of the XIX century. These ideas are mainly associated with Ernst Mach, Henri Poincaré and Pierre Duhem who faced the same challenge of Schumpeter in economics, which is, free the science (mechanics) from metaphysics (cosmology), creating a new theory vision.

JEL Classification: B30; B31; B40.

Historical roots of the ideas that subside clustering policies
Alexandre Rands Barros
Brazilian Journal of Political Economy

This paper shows the basic conceptions of the underlining ideas supporting clustering policies and explains their origins and justifications, for playing an important role on economic development. It is argued that, although they were fostered while liberal ideas were hegemonic, the concepts that give support to clustering policies are not based on this ideology only. They also seek support from ideas that accept public interventions on the economy. This means that one of the most efficient strategies to promote economic development nowadays has skeptical attitudes in relation to several liberal precepts.

JEL Classification: E52, E53.

Work and Politics: Locke and the Economic Discourse
Hugo E. A. da Gama Cerqueira
Brazilian Journal of Political Economy

This paper examines the emergence of an economic discourse separated from ethics or political philosophy. It argues that the works of Locke are a decisive moment in this process, for disclosing the existence of a sphere of the economy distinct from the sphere of the politics. Furthermore, the article suggests, contrarily to other conventional interpretations, that Locke doesn’t consummate the emancipation of the economic discourse, since he approaches the economic sphere on the basis of moral principles. 

JEL Classification: B11; B31; B40.

Environmental Ethics and Sustainable Development
Henrique Tomé Costa Mata, José Euclides A. Cavalcanti
Brazilian Journal of Political Economy

This article is about some principles on environmental ethics and conceptual discrepancies in the application of classical theories on discount rate and the economic efficiency in the context of sustainable development. The inconsistency of discount rate, in the environmental context, is understood as an essential element for deontological and environmental argumentation. The objective is to present an explanation about this problem, based on recent theoretical development of economic of natural resources and some environmental valuation techniques, aiming at sustainable development.

JEL Classifications: B0.