The monetary and fiscal history of Brazil, 1960-2016

Arbeitspapier

Brazil has had a long period of high inflation. It peaked around 100 percent per year in 1964, decreased until the first oil shock (1973), but accelerated again afterward, reaching levels above 100 percent on average between 1980 and 1994. This last period coincided with severe balance of payments problems and economic stagnation that followed the external debt crisis in the early 1980s. We show that the high-inflation period (1960-1994) was characterized by a combination of fiscal deficits, passive monetary policy, and constraints on debt financing. The transition to the low-in inflation period (1995-2016) was characterized by improvements in all of these features, but it did not lead to significant improvements in economic growth. In addition, we document a strong positive correlation between inflation rates and seignior age revenues, although in inflation rates are relatively high for modest levels of seignior age revenues. Finally, we discuss the role of the weak institutional framework surrounding the scale and monetary authorities and the role of monetary passiveness and in inflation indexation in accounting for the unique features of inflation dynamics in Brazil.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IDB Working Paper Series ; No. IDB-WP-990

Classification and Topics

• Classification: Wirtschaft ; Monetary Systems; Standards; Regimes; Government and the Monetary System; Payment Systems ; Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy ; National Deficit; Surplus ; National Debt; Debt Management; Sovereign Debt
• Subject: Brazil's hyperinflation ; Stabilization plans ; Fiscal deficits ; Wirtschaftslage ; Schock ; Entwicklung ; Konjunktur ; Inflation ; Geldpolitik ; Öffentliche Schulden ; Finanzpolitik ; Brasilien

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Ayres, Joao ; Garcia, Márcio Gomes Pinto ; Guillen, Diogo ; Kehoe, Patrick J.
• Event: Veröffentlichung
• (who): Inter-American Development Bank (IDB)
• (where): Washington, DC
• (when): 2019

Further information

• DOI: doi:10.18235/0001672
• Handle: http://hdl.handle.net/10419/208175
• Last update: 10.03.2025, 11:43 AM CET