Vol. 20 No. 2 (2000): Apr-Jun / 2000

Vol. 20 No. 2 (2000)

Apr-Jun / 2000
Published April 1, 2000


The articulation of industrial and commercial policies in contemporary developing economies: an analytical discussion
André Luiz Nassif
Brazilian Journal of Political Economy

The article discusses the importance of the connection between industrial and
trade policies within the current process of globalization in the world economy. In spite of
being inspired by the recent Brazilian trade liberalization, all questions analyzed here are
basically theoretical ones. The author discusses how the connection between industrial and
trade policies are analyzed within the international trade theories as well as how the latter
offers theoretical arguments favorable to industrial policies.

JEL Classification: L52; F68.

The Politics of Expertise in Latin America: Antecedents and Actualities
Laurence Whitehead
Brazilian Journal of Political Economy

All public activities are in some broad measure political, and all require certain
specialised skills, which may be termed “expertise”. But over time and space the realm of
the specifically “political” may either expand or contract. Equally, what counts as expertise,
and how much autonomy it will be granted, also varies over time and space. Horsemanship,
literacy, oratory, textual exegesis, and an understanding of global financial derivatives have
each been regarded as the hallmark of the modern expert in one setting or another. The relationship
between the “generalist” politician and the “specialist” expert is one of the most
ancient and recurring themes in political science. Effective and durable rule requires the enlistment
of a range of competences, yet government is not reducible to technique. How then
are the rulers to be guided by their advisers without being usurped by them?

JEL Classification: J24; D72; D82.

The Concepts of Ricardian, Keynesian and Schumpeterian Adjustments and the Question of Employment in the Brazilian Economy
Silvia Harumi Toyoshima
Brazilian Journal of Political Economy

The aim of this paper is to discuss the relationship between economic growth,
technical progress and employment generation, using Neo-schumpeterian concepts about
the process of adjustments available to all economies. It discusses the possible trade-offs
among the three kinds of the most important adjustments — “Ricardian “, “growth” and
“Schumpeterian” — which represent, in fact, trade-offs between short and long-term growth.
Based on this conception, it discusses the possible impacts of the exploration of each kind
of adjustment on the Brazilian level of employment. In addition, it preliminarily identifies
the productive segments to be stimulated in order to simultaneously consider economic efficiency
and employment generation. The main conclusion is that to associate employment
generation, economic growth and modernization, the Brazilian economy should invest not only in the most dynamic segments of the new technological paradigm, but also in the traditional
segments, because they have a higher employment generation capacity.

JEL Classification: O40; O30; J81.

The Credit Rationing Model and the Novo-Keynesian Monetary Policy: A Critical Analysis
Jennifer Hermann
Brazilian Journal of Political Economy

The paper discusses and criticizes the credit rationing model (CRM) and its use
to support the new-Keynesian approach to the monetary policy. After analyzing the working
of the model in the different phases of the business cycle it is concluded that: (i) in the
upward phase, demand rationing equilibrium — which is a condition for recommendation
of counter-cyclical monetary policy in the CRM scope — is not plausible as a macroeconomic
phenomenon, but only at microeconomic level; (ii) in the downward phase, although
the demand rationing is a plausible equilibrium, it does not occur for the reason alleged by the CRM (the rigidity of the interest rate), neither it does act in favour of the transmission
mechanism of monetary policy. These conclusions imply the rejection of the CRM as theoretical
basis for monetary policy analysis, as well as of the new-Keynesian approach about this
theme. Finally, it is argued that, at macroeconomic level, the unique theoretical contribution
of the CRM is to justify “vertical” interventions of government in financial markets, through
financing policies to sectors or projects which risks are more difficult to estimate, notably, in
infra-structure, R&D and new-technology sectors.

JEL Classification: E12; G21; G31.

The Philosophical Keynesianism agenda: origins and perspectives
Rogerio P. de Andrade
Brazilian Journal of Political Economy

This paper addresses what I label Philosophical Keynesianism, mapping out its
historical and analytical origins and pointing out its perspectives as an alternative benchmark.
Its historical emergence is related to some theoretical and methodological research
results within the post-Keynesian school of economic thought. An assumption is made as
to the proper place Philosophical Keynesianism will have in the future, for its scope of investigation
is becoming much more comprehensive and inclusive than the economic school
which engendered it. The paper reviews some major contributions of this new field of inquiry,
such as the books of Carabelli, O’Donnell and Davis. It also seeks to reinforce the case
that, as it is quite clear from Keynes’ approach to economic theorizing, economics should be
seen as a moral and socio-historical science rather than a natural science, and that a more realistic and relevant study of economic phenomena should be grounded on some sort of
interdisciplinary research.

JEL Classification: B22; A12; A13.

The Debate between Keynes and the “Classics” on Interest Rate Determinants: A Big Waste of Time?
José Luís Oreiro
Brazilian Journal of Political Economy

This article presents the debate between Keynes and the Classics relative to
the determinants of the rate of interest, with the objective of analyze if there is any subject
theoretically relevant under discussion. We demonstrate that, contrary to what has been said
by many neoclassical scholars like Hicks, there is an important theoretical question being
discussed between Keynes and the Classics, that is the mechanism according to which the
plans of saving and investment have influence over the rate of interest. For the “Classics”
these decisions have immediate influence over the rate of interest, i.e. the immediate impact
of variations of saving and investment is over this variable. For Keynes, however, the immediate
impact of these variations will be over the level of income and employment. As a result
of this effect there will be a change in the level of interest rate. This same question reappears on the debate between Asimakopulos, Kregel and Davidson; but in a different context, that
is the consideration of propensity to save as a financial restraint to investment decisions.

JEL Classification: E12; E43.

Labor Values and Production Prices in a Sraffian Economic System with Extensive Income
Marina Silva da Cunha, Rodolfo Hoffmann
Brazilian Journal of Political Economy

This article develops an extension of Sraffian’s approach, considering a model
where the economy is divided into two sectors, the industrial and the agricultural. From a
system in physical units it is possible to determine labour values and prices of production.
The paper analyses the determination of labour values using Morishima’s suggestion, with
linear programming. It is shown that in an economic system with land scarcity the existence
of positive surplus-value is not a sufficient condition for positive profits.

JEL Classification: B51; D46.

The convergence between Evolutionism and Regulationism
José Eli da Veiga
Brazilian Journal of Political Economy

The purpose of this paper is to compare the foundations of two theoretical lines
that have frequently been used in political economy: the evolutionist and the regulationist.
The basic premise is that these two lines are still closely linked to their respective parents:
the works of Schumpeter and Marx. That is, both their similarities and their differences are
more in their genetic codes than in their adaptations to the environment in which they developed:
neoclassical microeconomics and Keynesian and Kaleckian macroeconomics.

JEL Classification: B31; B14; B25; B51; B52.

Megainstitutions and Financial Instability: The challenges for prudential regulation
Marcos Antonio Macedo Cintra, Maria Cristina Penido de Freitas
Brazilian Journal of Political Economy

This paper analyses the recent process of the financial concentration in major industrialized
countries. It reveals that the formation of large diversified financial conglomerates
consolidates the so-called “full-service banking or financial supermarkets” in the United
States and the Allfinaz in Europe. It also evaluates the role played by these megainstitutions
in the intensification of financial instability due to increasing potential moral hazard and
the systemic risk. Finally, it deals with difficulties faced by authorities in the supervision and
control of these megabanks.

JEL Classification: G21; G34; L40.

The Nature of the Money Supply: Comments on Basil Moore’s Theory
Terezinha Saracini
Brazilian Journal of Political Economy

Basil Moore at recent work develops his conception of endogenous money. Into
the implications, understand that his theory present incongruencies in relation to some parts
the Keynes’ theory. This paper presents commentaries about horizontalist view, focalizing
the incompatibility between liquidity preference and endogenous money, aimed for Moore.
KEYWORDS: Money supply; money endogeneity; post-Keynesianism; history of economic
thought; Basil Moore.

JEL Classification: E12; E51; E42.