Economic growth, inequality and crony capitalism : the case of Brazil / Danilo Rocha Limoeiro.

Format:

Book

Author/Creator:

Limoeiro, Danilo Rocha, 1982- author.

Series:

Routledge studies in the modern world economy

Language:

English

Subjects (All):

Industrial policy--Brazil.

Industrial policy.

Transaction costs.

Business and politics--Brazil.

Business and politics.

Economic development--Moral and ethical aspects--Brazil.

Economic development.

Brazil--Economic conditions.

Brazil.

Physical Description:

1 online resource (xiv, 207 pages)

Edition:

1st ed.

Place of Publication:

Abingdon, Oxon ; New York, NY : Routledge, 2021.

Summary:

"Researchers in international development have long argued that the high costs of doing business harms prosperity in developing countries, a claim that invites the question of why governments impose these costs and why societies fail to enact reforms reducing them. This book seeks to answer the question by looking at the case of Brazil, a large and highly unequal economy riddled with state-imposed transaction costs. By delving into the political dynamics underlying a costly business environment, this book provides the reader with novel insights into crony capitalism and inequality. It argues that the root cause of a costly business environment is the collusion between political actors, bureaucrats and business insiders. Politicians and bureaucrats relish their discretion over rules and policies as a power resource, since they can increase or decrease the costs of doing business faced by firms and sectors. Business insiders collude with government agents to access the loopholes that decrease the cost of doing business, thus gaining a competitive edge over outsiders. This gives the insiders weaker preferences for reforms that could decrease the overall cost of doing business. By pursuing their self-interest, these actors create a low-level equilibrium that perpetuates crony capitalism and inequality, to the detriment of overall prosperity. The book makes its case with a sophisticated combination of formal modelling, quantitative analyses and in-depth case studies of tax policy and of the pharmaceutical and agricultural sectors in Brazil. Observers have declared the need for reforms that improve the business environment in developing countries for a long time. However, the findings presented in this book suggests they might have underestimated the challenge ahead. Scholars and policy-makers in international development, business politics and political economy will be interested in the innovative perspective of this book"-- Provided by publisher.

Contents:

Cover

Endorsements

Half Title

Series Page

Title Page

Copyright Page

Table of Contents

List of figures

List of tables

Preface

1. Cronyism, growth and inequality

Ricardo's predicament and the argument in short

Contribution: understanding Ricardo's predicament

Roadmap: a central puzzle and its explanation

Capitalism, regulation, Left and Right: a brief reflection

2. Crony capitalism actors, continuity and change

Crony capitalism in Brazil

Business

Politicians

Bureaucrats

Formalizing the argument

Change

3. Industry leaders and political engagement

Are industry leaders more politically engaged?

Testing the hypothesis in Brazil

Estimation

Conclusion

4. The politics of taxation in Brazil

Disjoint layering and the tax system

Subnational taxation and tax breaks

Tariff policies

5. Pharmaceuticals

Functions and distortions of bureaucracies

The pharmaceutical industry in Brazil

The cases of São Paulo and Goiás

Anvisa: welcomed but unloved

Why not fight back against regulatory distortion?

6. Agriculture

Blurred lines

The agricultural boom in Brazil

Demand for Pareto optimal reforms

The bootstrap sector?

The political clout of agribusiness

7. Conclusion

Future research

Bibliography

Index.

Notes:

Includes bibliographical references and index.

Description based on print version record.

ISBN:

1-00-302033-X

1-000-08866-9

1-000-08860-X

1-003-02033-X

9781003020332

OCLC:

1143800144