Chicken or Turtle? Brazil’s Disappointing Growth Author: Marcio Garcia -
No longer being able to count with the falling unemployment rate nor with the high investment rates, the only way Brazil could grow at higher rates is if the total factor productivity (TFP), i.e., the amount of output produced with the same quantities of capital and labor, were expanding. However, the only sector that exhibits robust TFP growth is agriculture. EMBRAPA (Brazilian Agriculture and Livestock Research Enterprise) is a rare case of successful long-term public policy. The other sectors, especially manufacturing, are unable to overcome the Brazilian economy’s structural bottlenecks: inefficient infrastructure and education; extremely high and distortionary tax burden, in order to finance exaggerated public expenditures; labor laws that encourage informality; slow and expensive justice system; high protectionism, hindering international integration and lowering competitiveness - See more at: http://www.economonitor.com/blog/2014/03/chicken-or-turtle-brazils-disappointing-growth/?utm_source=contactology&utm_medium=email&utm_campaign=EconoMonitor+Highlights%3A+High+Alert#sthash.nUzvBnwX.dpuf
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