External shocks and financial imbalances: an interpretation of the Brazilian crisis

Martin Branco Kirsten, Henrique Morrone

Abstract


This paper investigates the causes of the Brazilian recession that began in 2014. If, on the one hand, the conventional diagnosis attributes the crisis to a lack of control of public finances, other interpretations emphasize external shocks and excessive indebtedness of the private sector. The alternative hypothesis is that the deterioration of public accounts is a consequence of the crisis and not its cause. The methodology developed by Toda and Yamamoto (1995) is used to verify the hypothesis of non-causality of Granger between the time series of the balances of the private sector, public sector and current account, from the Central Bank of Brazil (BCB, 2017) for the 2002-2017 period. The results suggest that the balances of the external and private sectors cause in the Granger sense the balance (result) of the public sector.


Keywords


Teorias da crise; Setores institucionais; Modelo econométrico; Brasil.

References


Abell, J. D. (1990). Twin deficits during the 1980s: An empirical investigation. Journal of macroeconomics, 12(1), 81–96.

Almeida, M., Lisboa, M. B., & Pessoa, S. (2015). O ajuste inevitável. Folha de São Paulo. Disponível em:

ilustrissima/226576-ajuste-inevitavel.shtml

Arestis, P., de Paula, L. F., & Ferrari, F. (2007). Assessing the economic policies of President Lula da Silva in Brazil: has fear defeated hope? In: P. Arestis & M. Sawyer (Eds.) Political economy of Latin America: recent economic performance. Basingstoke: Palgrave Macmillan.

BCB - Banco Central Do Brasil. (2017). Séries temporais. Disponível em: . Acesso em 10 de outubro de 2017

Barro, R. J. (1974). Are government bonds net wealth? Journal of political economy, 82(6), 1095-1117.

Bolle, M. B. (2016). Como matar a borboleta-azul: Uma crônica da era Dilma. Rio de Janeiro: Intrínseca.

Borges, B. (2016). Bad Luck or Bad Policy: uma investigação das causas do baixo crescimento da economia brasileira nos últimos anos. In: R. Bonelli & F. Veloso (Orgs.), A Crise de Crescimento no Brasil. Elsevier/FGV-Ibre.

Bresser-Pereira, L. C. (2017). Como sair do regime liberal de política econômica e da quase-estagnação desde 1990. Estudos Avançados, 31(89), 7-22. doi: 10.1590/s0103-40142017.31890002

Carvalho, L.B. (2018). Valsa brasileira: do boom ao caos econômico. São Paulo: Todavia.

Christ, C. F. (1968). A simple macroeconomic model with a government budget restraint. The Journal of Political Economy, 76(1), 53-67.

Cripps, F., & Godley, W. (1976). A formal analysis of the Cambridge economic policy group model. Economica, New Series, 43(172), 335-348. doi: 10.2307/2553270

Godley, W. (1999a). Seven unsustainable processes. New York: Levy Economic Institute of Bard College, Annandale-on-Hudson.

Keynes, J. M. (1936 [1985]). A Teoria Geral do Emprego, do Juro e da Moeda. São Paulo: Nova Cultural.

Marquetti, A., Koshiyama, D., & Alencastro, D. (2009). O aumento da lucratividade expande a acumulação de capital? Uma análise de causalidade de Granger para países da OCDE. Revista de Economia Contemporânea, 13(3), 367-390. doi: 10.1590/S1415-98482009000300001

Nassif, A. (2018). A valsa não totalmente afinada de Laura Carvalho: um ensaio-resenha crítico de Valsa brasileira: do boom ao caos econômico. Cadernos do Desenvolvimento, 13(23), 11-35.

Nikiforos, M., Carvalho, L., & Schoder, C. (2015). “Twin deficits” in Greece: in search of causality. Journal of Post Keynesian Economics, 38(2), 302-330. doi: 10.1080/01603477.2015.1065675

Ocampo, A. C., Rada, C., & Taylor, L. (2009). Growth and policy in developing countries: A structuralist approach. Columbia University Press.

Ocampo, J. (2009). Patterns of Net Borrowing in Open Developing Economies. In J. A. Ocampo, C. Rada, & L. Taylor (Orgs.), Growth and policy in developing countries: a structuralist approach (pp. 75-83). New York: Columbia University Press.

Oreiro, J. L. (2017). A grande recessão brasileira: diagnóstico e uma agenda de política econômica. Estudos Avançados, 31(89), 75-88. doi: 10.1590/s0103-40142017.31890009

Pessoa, S. (2016). Crise fiscal estrutural deve resultar em alta inflação no médio prazo. Revista Conjuntura Econômica, 70(10), 10-11.

Polak, J. J. (1957). Monetary analysis of income formation and payments problems. International Monetary Fund Staff Papers, 6(1), 1–50. doi: 10.2307/3866128

Prebisch, R. (1949). O desenvolvimento econômico da América Latina e seus principais problemas. Revista Brasileira de Economia, 3(3), 47-111.

Rezende, F. (2016). Financial fragility, instability and the Brazilian crisis: a Keynes-Minsky-Godley approach. Minds (Multidisciplinary Institute for Development and Strategies): Discussion paper, 1.

Rezende, F. (2017). Desalavancagem do setor privado. Valor Econômico. Disponível em:

desalavancagem-do-setor-privado>

Toda, H., & Yamamoto, T. (1995). Statistical inference in vector autoregressions with possibly integrated processes. Journal of Econometrics, 66(1-2), 225-250. doi: 10.1016/0304-4076(94)01616-8

Volcker, P.A. (1984). Facing up to the twin deficits. Challenge, 27(1), 4–9. doi: 10.1080/05775132.1984.11470902




DOI: http://dx.doi.org/10.33834/bkr.v5i1.167

Refbacks

  • There are currently no refbacks.


Copyright (c) 2019 Martin Branco Kirsten, Henrique Morrone

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Indexed in

_________________________________________________________

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.