- The Oxford Handbook of the Brazilian Economy
- The Colonial Economy
- The Nineteenth and Early Twentieth Centuries
- Brazilian Structuralism
- Brazil’s Import-Substitution Industrialization
- Experiences of Inflation and Stabilization, 1960–1990
- Leviathan Captured Neoliberalism as Solution and Problem in Brazil
- Growth Volatility and Economic Growth in Brazil
- The Brazilian Development Bank
- The Evolution of Brazil’s Banking System
- Brazil’s Macroeconomic Policy Institutions, Quasi-Stagnation, and the Interest Rate–Exchange Rate Trap
- Evolution and Sectoral Competitiveness of the Brazilian Manufacturing Industry
- The Agricultural Sector
- Traditional Agriculture and Land Distribution in Brazil
- Brazil’s Agricultural Modernization and Embrapa
- Manufacturing, Services, and the Productivity Gap
- Energy in Brazil: Past and Future
- Trade Policy from the 1930s to the Present
- Regional Disparities
- Brazil’s Northeast
- Changes in Income Distribution in Brazil
- The Development of Brazilian Education: A Tale of Lost Opportunities?
- Anti-Poverty Transfers and Poverty Reduction
- South-South Cooperation for Social Development: Brazil and Africa Examined
- Labor Market Development in Brazil: Formalization at Last?
- Environmental Issues
- The Economics of Health in Brazil
- Brazil, the BRICS, and the Changing Landscape of Global Economic Governance
- Brazilian Trade and International Economic Prospects in an Anti-Globalization Era
- The Evolution of Foreign Direct Investment in Brazil
- Multinational Corporations from Brazil
- The Rise and Fall of State Enterprises
- Antitrust and Competition Policy in Brazil
- Corruption Scandals, the Evolution of Anti-Corruption Institutions, and Their Impact on Brazil’s Economy
Abstract and Keywords
This chapter analyzes the Brazilian inflation and stabilization experiences during a period spanning three decades, from 1960 to 1990. It focuses on five stabilization plans. The first is the PAEG Plan, a neo-orthodox stabilization plan, which did not eliminate inflation but reduced its trend rate. The PAEG Stabilization Plan started as a fully orthodox plan, but later, as the social cost imposed by the inertial component of inflation became apparent, an indexation mechanism was devised with a forward component in wages readjustment, decreasing the backward component. This mechanism, which intended to preserve the average real worker’s wage, became a standard tool of stabilization plans in Brazil, despite the criticism it received at that time. The other four are heterodox plans, Cruzado, Bresser, Summer, and Collor, implemented during the so-called lost decade.
Fernando de Holanda Barbosa, Professor, Brazilian School of Economics and Finance (EPGE), Fundação Getúlio Vargas, Rio de Janeiro
Access to the complete content on Oxford Handbooks Online requires a subscription or purchase. Public users are able to search the site and view the abstracts and keywords for each book and chapter without a subscription.
If you have purchased a print title that contains an access token, please see the token for information about how to register your code.