The Distributional and Employment Consequences of Export Promotion and Import Substitution in Brazil

Benedict Clements and Kwan Kim

Eastern Economic Journal, 1987, vol. 13, issue 4, 435-446

Abstract: This paper assesses the impact of the alternative foreign trade strategies of export promotion and import substitution on employment and income distribution in Brazil. The impact of the expansion of nontraded goods production is also examined for purposes of comparison. Using a modified input-output technique, the authors' results reveal that export promotion generates more employment than import substitution and nontraded goods production. The size distribution of income under export promotion is more equal than under import substitution or nontraded goods production, but only slightly more so. Hence, export promotion cannot be seen as a panacea for Brazil's extreme income inequality.

Date: 1987
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