From the 1980s on, the exhaustion of Brazil’s postwar economic-development model became
manifest in severe macroeconomic disequilibriums and the inability to maintain earlier high and
sustained rates of economic growth. The stagnation of investment and weak efforts at technical
innovation translated into low levels of efficiency, productivity, and technological modernization.
The 1990s saw a break with the statist postwar model in favor of reduced state economic
intervention and a more comprehensive liberalization of both trade and capital flows. Among the
economic policies adopted to this end, trade and financial liberalization and privatization of stateowned enterprises stand out. Proponents expected these policies to eliminate bottlenecks
hindering the competitiveness of Brazilian industry and to hasten the convergence of Brazil’s
technology, managerial practices and levels of productivity to those of the “advanced”
economies.(…)