Vol. 10 No. 4 (1990): Oct-Dec / 1990

Vol. 10 No. 4 (1990)

Oct-Dec / 1990
Published October 1, 1990


Brazilian public sector and financing debt: 1983-1988
Paulo Nogueira Batista Jr.
Brazilian Journal of Political Economy

This article analyses the evolution of the Brazilian public sector’s deficit and
of its sources of financing from 1983 to ·1988. It is shown that the government’s growing
financial problems arose, to a certain extent, from a sharp reduction in its primary surplus
from 1985 on. But this was partly compensated by a substantially lower interest burden. As
a result, there was no explosive increase in the operational deficit up to 1988. The public
sector’s increasing financial difficulties resulted basically from a significant narrowing of the
supply of credit, a process that began with the external debt crisis and that was reinforced by
the effects of accelerating inflation combined with increasing doubts concerning the government’s

JEL Classification: H62.

The fourth Kondratiev cycle
Ignácio M. Rangel
Brazilian Journal of Political Economy

The world economy is passing through the phase b (declinant) of the fourth
Kondratiev long cycle. The Brazilian economy is no exception. A kind of exception are the
“Asian tigers”, where the state plays a significant role. The Brazilian policy makers should
study this experience.

JEL Classification: E32.

Asia and Latin America: a fiscal comparison
Mitsuhiro Kagami
Brazilian Journal of Political Economy

A comparison between East and Southeast Asian countries and Latin American
countries is made with respect to public finance, Special emphasis is placed on a fiscal
comparison during the 1970s and the 1980s. Government deficits widened more in Latin
America than in Asia in the corresponding two periods. An unprecedent price hike in Latin
America is positively related to these large deficits. Remarkable increases in interest payments
for public debts during the 90s in Latin America narrowed the margin of fiscal policies.
Therefore, some measures on debt relief. as well as fundamental tax reform are urgently
needed in Latin America.

JEL Classification: H11; H50; H60.

High inflation and hyperinflation: a post-Keynesian view
Fernando J. Cardim de Carvalho
Brazilian Journal of Political Economy

Inflation has become, in the 80’s, the most important barrier to resuming economic
growth in Brazil. A post-Keynesian approach to this problem stresses the effects that
continuing high inflation has on beliefs and institutions, especially the system of money forward
contracts that is fundamental to organize and coordinate an entrepreneurial economy. A
High Inflation Regime is defined by the introduction of new monies-of-account for forward
contracts, that is, indexation, and by a change in the modes of price formation. It is shown that
High Inflation characterizes an unstable equilibrium that may degenerate into hyperinflation.
The permanence of high inflation, however, may engender stagnating tendencies.

JEL Classification: E31


The relationship between mark-ups, concentration, and profitability
Arthur Barrionuevo Filho
Brazilian Journal of Political Economy

This paper is a survey about industrial organizations. We intend to clarify the
state of the art of empirical studies on the industrial competition. Basically, we discuss a
point of view that became consensus in this field about the decreasing competition in concentrated
industries. Then we examine the importance of the barriers to entry to establish
enterprise behaviour and their power to fix prices. Finally, based on the renaissance of classical
economics there is an overview about diversification and the role of the profit rate in a
capitalist economy.

JEL Classification: B25; B20; L00; L10

Perspectives of capitalism and socialism in the search for a class theory of the state and democracy
Ronald H. Chilcote
Brazilian Journal of Political Economy

The crisis of contemporary political science and social science, in general, reflects
the crisis in both capitalism and socialism. The search for theoretical alternatives in order to resolve
the crisis has involved redirection rather than a new direction. This paper first examines
various post-forms of society, specifically post-liberalism, post-imperialism, and post-Marxism
and affirms that, while these conceptions may be innovative and provocative, nevertheless
they do not allow for the shaping of new paradigms. Second, the paper critically examines
major themes of the 1990s and concludes with the observation that intellectuals differ over the
direction of development once questions become of fundamental preference for capitalism or
socialism; over questions of the state because of their use of either class or non-class analyses;
and over questions of socialism and democracy because of their inclination to favor either
indirect or direct forms of participation in the political process. Thus, the preference for either
capitalism or socialism may shape ideals and distort realities so that the production of new
ideas may be nothing other than the reproduction of old ideas in a new guise.

JEL Classification: P51.


Thirlwall Law
Paul Davidson
Brazilian Journal of Political Economy

This note discusses A. P. Thirlwall’s economic development model as a “demanddriven”

JEL Classification: O41.

Classical economic theory and marginalist economic theory
Ronaldo Fiani
Brazilian Journal of Political Economy

This paper discusses the importance of the differences between classical and
marginalist economic theories, with a special interest on David Ricardo’s thought. In order
to analyse the theoretical incompatibility among classicals and marginalists, the critical
hypotheses to prove the referred incompatibility are settled and checked. It is seen that the
most important element in distinguishing classicals and marginalists is the difference in the
approach to the labor market. In fact, the classical determination of the wage rate is sharply
distinct from the General Equilibrium Theory, based on the supply and demand principle.

JEL Classification: B12; B13; D46.

Post-war transformations and ECLAC economic thinking
Ferdinando Figueiredo
Brazilian Journal of Political Economy

This article is a tentative approach to reconstitute the circumstances which characterized
the creation of the so-called “CEPAL economic thinking”. The author initially tries
to associate this thinking with the “keywords” (or “power ideas”) of “economic development”,
“industríalization” and “economic planning”, which has been raised and established
in Latin America at the end of World War II. Furthermore, analyses the general lines of the
CEP AL thinking, trying to identify its innovator character and the necessary steps to obtain
an active position by the State, assumed as the inductor entity of such development. A brief
evaluation of the resulting impacts of such ideas in Latin America and Brazil, including the
institutional point of view, is also considered.

JEL Classification: B22.