Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/316169 
Year of Publication: 
2025
Series/Report no.: 
Texto para Discussão No. 3107
Publisher: 
Instituto de Pesquisa Econômica Aplicada (IPEA), Brasília
Abstract (Translated): 
The text calls attention to two structural features of the Brazilian economy, i.e., the facts that the country has built a very impressive welfare state (WS) over the years, one that looks as strong and mature as ever, and that the Brazilian Real (R$) apparently has become a "commodity-currency" over this century, meaning that it tends to appreciate when (a selected basket of) world commodity prices in US dollars go(es) up. It is argued that, although relatively neglected in the literature, both features play key roles in the functioning of the Brazilian economy both in the short and the medium runs. A formal short period model of the economy - that is compatible with and fits actual Brazilian national accounts data - is presented to make the argument clear. Insights based on the model are then used to produce plausible medium run dynamic trajectories in which commodity prices and WS institutions interact in meaningful ways.
Subjects: 
welfare state
commodity-currency
Brazilian economy
commodity prices
exchange rate depreciation
JEL: 
E12
O54
F41
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Working Paper

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