World Inflation and the Developing Countries

By Surjit S. Bhalla; Gabriel Siri et al. | Go to book overview

risen moderately to 2.86.75. One statistical model of debt servicing indicated that as of 1976 there was no indication of serious debt servicing difficulty for Brazil, given its ratio of debt service, level of reserves relative to imports, and amortization rate.76.

The future is more cloudy. Projections by the Wharton econometric forecasting model for Brazil indicate that with growth rates rising gradually from 6 percent to 8 percent through 1982, Brazil will experience a debt service ratio (interest and amortization relative to exports) rising from 51 percent in 1977 to approximately 65 percent in 1980-82.77. Projections by Fishlow similarly give reason for concern that rapid growth may be incompatible with manageable external debt.78. Moreover, the sharp deterioration of the trade balance caused by oil price increases in 1979 makes prospects even less favorable.

In broad terms Brazilian policy probably erred on the side of too much accumulation of debt in 1974-77, just as Brazilian growth policies were, on balance, excessively expansionary over this period.


Conclusion

Despite its large size and relatively closed nature, the Brazilian economy was not immune to the external shock of the 1970s. In a three-punch sequence, the international economy first induced reserve and monetary expansion ( 1971-73), then administered a shock of high price increases for traded commodities, especially oil ( 1973-74), and then delivered a final blow in the form of decreased real demand for exports as industrial countries entered serious recession ( 1975). Statistical tests show that a large part of the acceleration of Brazil's inflation (from a low of 15 percent in 1973 to 43 percent by 1977) was caused by the sharp rise in prices of imported goods in 1974 and by Brazil's own imposition of higher import protection in 1975.

These shocks helped interrupt the Brazilian economic miracle of 10 percent yearly growth (although internal factors such as the exhaustion

____________________
75.
Conjuntura econômica, vol. 31 ( March 1977), p. 114; International Financial Statistics, various issues.
76.
Cline, "Brazil's Emerging International Economic Role," p. 73. However, the high level of Brazil's private debt makes the model applied a somewhat optimistic one since it applies only public debt figures.
77.
As cited in Bacha, "Brazil's Balance of Payments," pp. 17-19.
78.
Fishlow, "Debt, Growth, and Hemispheric Relations."

-132-

Notes for this page

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this page

Cited page

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited page

Bookmark this page
World Inflation and the Developing Countries
Table of contents

Table of contents

Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this book

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this book
  • Bookmarks
  • Highlights & Notes
  • Citations
/ 272

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.