Orthodox stabilization programmes in Brazil 1964/68 and 1980/84: reflections on their perverse effects

Abstract

The perverse effects associated to orthodox stabilization programmes, specially persist-ent inflation accompanied by a prolonged period of recession with unemployment, attract the attention on the evaluation of consistency between the orthodox approach and the economic situation which characterize the crisis. Then, the comparative study of two economic stabiliza-tion policies in Brazil, in the sixties and eighties — PAEG (1964-1968) and Stabilization Pro-gram (1980-1984) — gives opportunity to develop an analysis of the incoherencies in orthodox view about the roots of inflation and balance of payments disiquilibria.

JEL Classification: E31.