Economic Formation of Brazil: from South Atlantic to South America

in F. Boldizzoni and Pat Hudson, Routledge Handbook of Global Economic History, London,
2016, pp. 361-376

Luiz Felipe de Alencastro

This chapter discusses economic history in and about Brazil focussing upon the issues and
works that mark the two centuries of Brazil’s emergence as an independent nation state. A
sort of Brazilian exceptionalism could be suggested insofar as the country stands as the single
colonial aggregate that was not fragmented after its Independence in 1822, as well as the only
Lusophone nation and long standing constitutional monarchy in the Americas (1822-1889).
Encompassing the whole territory of Portugal’s vice-kingdom, trading directly with
Portuguese Africa slave ports until 1850 and chief destination of Portuguese immigration until
1950, Brazil maintains a long relationship with Portuguese overseas history and
historiography. Because Lisbon’s colonial policy tried to replicate in Angola the Brazilian
plantation sector, economic debates during the nineteenth and twentieth centuries in the two
countries were sometimes intermingled. Both Portuguese and Brazilian developmentalists,
past and present, praised the Marquis of Pombal’s enlightened despotism, which encouraged a
protected manufacturing sector in eighteenth-century Portugal, but their liberal adversaries in
the two countries criticized that view.1
The Lisbon Court’s transfer to Rio de Janeiro (1808-1821) embodied a Luso-Brazilian
ruling class significantly experienced in European affairs and vested with a state building
project. Distinctive from the dominant class formed by landowners who handled regional and
local powers, the central administration remained attentive to the world's changes. Edgy
negotiations of commercial treaties, coupled with London’s efforts to suppress the traffic of
enslaved Africans, threatened the government’s sovereignty. Brazil, alongside the United
States, was one of the main independent exporters of slave-grown commodities and the only
American nation to practice a large scale Atlantic slave trade (1822-1850). This was the
distinctive feature of the Anglo-Brazilian relations throughout the transition from informal to
formal imperialism.2 The historical chasm separating Africa and Brazil caused international
crises that bolstered the role of the diplomats and the Foreign Affairs Ministry. From that time
onwards, diplomats played a major role in the country’s economic arrangements and

1. As observed by Bairoch, Pombal’s economic policies (1755-1776) had a pioneering role

insofar as they explicitly took into account the dependency relation between Portugal and
England, Paul Bairoch, Commerce extérieur et développement économique de l’Europe au
XIXe siècle (Paris 1976),269. On Pombal’s economic policies, J. Pedreira, “A Indústria”, in
Pedro Lains & A. Ferreira da Silva, História Económica de Portugal, (Lisbon 2011), 3 vols.,
v. 1, 196-208. For a liberal critique of Pombal’s doctrinal influence in today’s Brazil, Antonio
Paim (ed.), Pombal na cultura brasileira, (Rio de Janeiro 1982).

2 . L. Bethel, The Abolition of the Brazilian Slave Trade: Britain, Brazil and the Slave Trade
Question, 1807-1869 (Cambridge 1970), P.J. Cain & A. G. Hopkins, British Imperialism:
1688-2000, (London, 2014), 260-267.

1
agreements.3 Therefore, European and American overseas affairs were discussed among the
ruling circles of Rio de Janeiro, a global maritime hub before the opening of the Panama
Canal (1914). The end of Slavery (1888) and the overthrow of the Monarchy (1889) removed
the two main disparities that singularized Brazil among the American nations.
Alongside earlier significant works, three recent books have covered the country’s economic
history. 4 Paiva Abreu’s collective book, mostly a survey of past and present economic
policies, presents an updated and expanded edition of his 1989 publication used in many
faculty courses. Economists who participated in the design and the implementation of the
Real Plan during the Cardoso presidencies authored some of the chapters. Bresser Pereira’s
volume reviews the main moments of Brazil’s economic and politic history, emphasizing the
last half-century in which he participated as a prominent development economist and policy
maker. Klein and Luna’s scholarly study covers the economic and social history of Brazil
from 1889 onwards. In tracing the history of economic history in Brazil one should however
start with the nineteenth century.

The slave trade and the endurance of slavery

Illustrative of the colonial elite’s influence, the São Paulo born José Bonifácio de Andrada
had a career as a scientist and a high-ranking officer in Portugal. A follower of the
Enlightenment and a Freemason, he joined the Court in Rio de Janeiro in 1819. Eventually, he
became the first head of Brazil’s national government (1822-1823). Aware of the British
staunch opposition to the Atlantic Slave Trade, he unsuccessfully proposed parliamentary
measures for its suppression as well as complementary steps to peacefully incorporate the
Amerindians into economic life. His writings inspired other economic and social reformers
during the nineteenth century.
Brazil’s slave traffic was bilateral, which explains its resilience in the national period. As is
well known, around 95% of the voyages disembarking Africans in Brazil had left the
Brazilian ports loaded with locally produced or reexported Asian and European goods.5 The
intensification of the bilateral trade in the first half of the nineteenth century, along with the
persistence of Slavery until 1888, sustained Brazilian elites' concern about Native American
labour, slavery, plantation economics and immigration, past and present.
Edited and annotated in 1851 by Francisco Adolfo de Varnhagen, author of a commanding
history of Brazil (1854-1857), Gabriel Soares de Souza's manuscript on the settlers’
undertakings in 1587 disclosed the early stages of Portuguese America’s merchant
production.6 In the same vein, Antonil’s rare book on the cane sugar and tobacco plantations,

3 . P. R. de Almeida, Formação da diplomacia econômica no Brasil: as relações econômicas

internacionais do Império, (São Paulo 2001)
4 . M. de Paiva Abreu (ed.), A Ordem do Progresso, Dois séculos de Política Econômica no
Brasil, (Rio de Janeiro 2014), L.C. Bresser Pereira, A Construção Política do Brasil, (São
Paulo 2014); F. Vidal Luna and Herbert S. Klein, The Economic and Social History of Brazil
since 1889, (Cambridge 2014).

5 . D. Eltis and D. Richardson, Atlas of the Transatlantic Slave Trade, (London, 2010), 120-
122, 141-143, 151-153,156.

6 . Varnhagen’s História Geral do Brasil (Rio de Janeiro 1854-1857), based on archival

sources, disclosed significant data on economic activities. This valuable repository of

2
as well on the gold rush in Minas Gerais (1711), was reprinted in Rio de Janeiro in 1837. A
Jesuit and missionary administrator in Bahia, Antonil’s descriptions shed light on sugar mills,
slave management and plantation administration. His work became the chief contemporary
text on Brazil’s colonial economy. Many annotated editions of Antonil’s book followed,
including recent translations in French and English.7
The government-funded Instituto Histórico (1838–) promoted research on economic
history throughout the nineteenth and twentieth centuries. Likewise, the Sociedade
Auxiliadora da Indústria Nacional published in its journal (1833-1892) texts on industrial and
plantation innovations. Entrepreneurial circles affiliated to the Sociedade formed associations
that evolved into the National Industry Confederation (1938–). By themselves or associated
with the government, those corporations stimulated research on the country’s production and
foreign exchanges.
Controversies over free-trade (particularly about the 1844 Alves Branco Law instating
the first protectionist tariff); over European and Asian immigration (related to the 1850 Law
on Public Land); over companies’ and plantation credit (regarding the Commercial Code of
1850 and the 1864 Mortgage Law); over bullion and paper money (at the 1853 re-foundation
of the Banco do Brasil as a commercial and currency bank); and over the economic crisis of
1857 and 1964 (the first to be fully felt in the country) generated surveys by Parliament and in
the Rio de Janeiro press. 8 The reproduction of European and U.S. publications that
popularized science and contemporary issues also played a critical role in the propagation of
the century’s transformations. These included almanacs and papers, particularly the Jornal do
Commércio (1827–), one of oldest continuously circulating economic periodicals edited in the
Americas. The essays of prominent economists, at times partially translated, were published
in Rio (as happened to the writings of Tooke, Juglar and Leroy-Beaulieu). Moreover, debates
on United States and Caribbean slavery and offered updated references to Brazilian writers
and policy makers. Among other authors, Wakefield’s thesis was known and debated in
relation to the 1850 Land Law, immigration policy and the rural economy.9
Plantation exports grew steadily in the 1840s and the country surpassed Java as the
world's first coffee exporter, a position that it would hold until today. This generated a surge
in debates about railroads, canals and steamship navigation, and more generally on the
transition from slavery to free labour. Employing Brazilian and Portuguese funds engaged in
African exchanges that reflowed into Rio de Janeiro at the end of the Slave Trade (1850), the
Viscount of Mauá, a former British bank agent, emerged as a leading national entrepreneur.
Later entitled ‘Autobiography’ and regularly reedited and discussed, his creditors’ report

information was integrated and enlarged in the 1907-1928 edition of the História annotated by
Capistrano de Abreu and Rodolfo Garcia.
7. Cultura e opulencia do Brasil, por suas drogas e minas - André João Antonil, traduction
française et commentaire critique par Andrée Mansuy, (Paris 1968) ; Andre João Antonil,
Brazil at the Dawn of the Eighteenth Century, prefaced by Stuart B. Schwarz, (Dartmouth,
Mass., 2012).

8 . A. M. da Silva Ferraz, Relatório da Comissão encarregada pelo Governo Imperial de

proceder a um inquérito sobre as causas principais e acidentes da crise de setembro, 1864
(Rio de Janeiro 1865).

9 .See, e.g., O Auxiliador da Industria Nacional, August 1850.

3
describes his mid-century industrial and banking undertakings in Brazil as well as in the Rio
de la Plata (1878). Usually attributed to the Government’s interventionism, Maua’s
bankruptcy fuels recurrent controversy among economic historians from Brazil and abroad.10
In the 1840s and 1850s the Central government subsidised the construction of a canal
(lobbied for by sugar mill owners), a railroad (petitioned by coffee planters) around Rio de
Janeiro, and the railroad Recife-São Francisco river (crossing plantations and cattle farms of
the North East). Established in 1854, the Bureau of Public Land, later the Agriculture
Ministry (1860) acted as a rural labour department. From that time onwards until 1960, when
the Federal capital was transferred to Brasilia, Rio de Janeiro’s economic and political circles
retained dominance over the central government's decisions.
Overlooked by many historians, Ferreira Soares' (1860) survey of high food prices was
most relevant in the mid-century transition, when Brazil’s economy was decoupled from
Africa’s slave market.11 Portuguese mass migration to Rio de Janeiro was in its early stages so
the Slave Trade suppression constricted the labour market. Uncovering new statistics, Soares
argued that Agro-exports had nonetheless increased in the period, owing to the interprovincial
slave trade and to migrant rural workers. Moreover, he aptly asserted that the high food
prices, sparked by the coffee expansion around Rio de Janeiro, were a conjunctural trend that
would not last. By doing so, he dismissed beliefs in a shortage of labour, which raised
speculation about the reopening of the African Slave Trade.12

The Statistical Age and the Abolition of Slavery

Given the fact that Parliament adopted gradual reforms to eliminate slavery from 1850 until
1885, most of the writing on economic history, including surveys on the Amerindian policy,
refers to the labour question. Opinions on land and immigration policy were sharply divided.
Planters and export merchants wanted rural workers and proletarians from any country.
Chinese labourers were shipped to Rio de Janeiro in the 1850s, for example, to replace
enslaved Africans on the plantations. By contrast, the central government preferred to sell
public lands to European peasants and small farmers in order to ‘civilize’ and ‘whiten’ the
country. Permeated by racial theories and social Darwinism, these policies revealed opposing
views about the process of nation-building.
Perdigão Malheiro’s historical and juridical study of African and Amerindian Slavery
in Brazil (1867) was central in the discussions about ending slavery and promoting

10 . Anyda Marchant, Viscount Maua and the empire of Brazil: a biography of Irineu
Evangelista de Sousa, 1813-1889, (Berkeley, Cal. 1965). A.J. Renda Vitorino, “Política,
agricultura e a reconversão do capital do tráfico transatlântico de escravos para as finanças
brasileiras na década de 1850”, Economia e sociedade, 17 (3), 2008, 461-492.

11 . In 1841-1850, around 400,000 enslaved Africans disembarked in Brazil, of which

308.000 in the Rio de Janeiro area (the capital had 260.000 inhabitants, including 110,000
slaves, in 1849); not to mention the vast number of Africans imported in the previous decades.
Trans-Atlantic Slave Trade Database TSTD, accessed January 2015,
http://www.slavevoyages.org/tast/index.faces

12. S. Ferreira Soares, Notas estatísticas sobre a produção agricola e carestia dos generos
alimenticios no Imperio do Brasil, (Rio de Janeiro 1860), the book include the author’s
conferences and previous articles in Rio’s newspapers.

4
immigration. 13 Quoting Court judgements involving slaves, his record remains an
authoritative reference for today’s researchers. The economic and social coercion of freed and
free workers, including immigrants, on the coffee frontier was denounced by European
diplomats and by the press. Published in 1850 and later translated into Portuguese, with a
penetrating comment by Buarque de Holanda, the memoir of a Swiss immigrant exposed the
hardship in a São Paulo plantation in the late 1840s (1941). A topic further studied by
Carvalho Franco (1964), Viotti (1966), Beiguelman (1968) and Lamounier (2012).14
Notwithstanding substantial European immigration in the late nineteenth century, there
was a widespread perception of Brazil as an Africanized country. The ‘Scramble for Africa’
spread stereotypes of Africa’s wildness and this perennially troubled Brazilian elites and the
middle classes. Recently updated data have shown that the number of Africans disembarked
between 1550 and 1850 was six and half times larger than the number of Portuguese colonists
and immigrants. 15 Concerns regarding the composition of the population and the labour
question, as well as military recruitment problems during the War of the Triple Alliance
(1864-1870), drove the first national census (1872). Brazil was shown to have the largest
slave system in the Americas at this time.16 Disclosing data on sex, age, nationality, race,
status, housing, professions and religions, the Census portrayed the distribution of economic
and social conditions of the nearly 10 million inhabitants.17
The census information transformed the ability to observe slavery, the national
workforce and immigration. The data also supported the government report (1875) and
Planters Society report (1878) on rural work and export agriculture. 18 Furthermore,

13 . A. M. Perdigão Malheiro, A Escravidão no Brasil: ensaio histórico, jurídico, social, 3

vols. (Rio de Janeiro 1864-1867).
14 . Sérgio Buarque de Holanda, Memórias de um colono no Brasil – 1850, (São Paulo, S.P.,
1941); Maria S. de Carvalho Franco, Homens livres na ordem escravocrata, (São Paulo, S.P.,
1964); Emilia Viotti da Costa, Da Senzala à Colônia, (São Paulo, S.P., 1966); Paula
Beiguelman, A Formação do povo no complexo cafeeiro: aspectos politicos, (São Paulo, S.P.,
1968); Maria Lúcia Lamounier, Ferrovias e Mercado de Trabalho no Brasil no Século XIX.
(São Paulo, S.P., 2012).

15 . For African deportees see TSTD. Figures about Portuguese colonists and immigrants
(after 1822) are from my estimates.

16 . The War of the Triple Alliance (1864-1870) was fought between the allied forces of
Brazil, Argentina and Uruguay against Paraguay.

17 . The Census showed that Brazil’s population living in 1440 parishes amounted to
9,930,478 inhabitants, including 1,510,806 slaves (15%). Nevertheless, the 21 volumes of the
Census data published in 1873-1876 contained inaccuracies due to addition and aggregation
mistakes, Clotilde A. Paiva et al., Publicação crítica do recenseamento geral do Império do
Brasil de 1872 (Belo Horizonte, M.G. 2012).

18. J.C. de Menezes e Souza, Theses sobre a Colonização do Brasil, (Rio de Janeiro 1875);
Congresso Agrícola do Recife (Recife 1878); Congresso Agrícola do Rio de Janeiro (Rio de
Janeiro 1878).

5
projections of the 1872 data revealed that slavery would survive everywhere in the country up
to the twentieth century, notwithstanding the gradual effect of the emancipation laws. This
discredited the gradualist policy and radicalized the abolitionist movement. Nabuco’s
Abolitionism (1883), considered by many as the country’s foremost political writing,
conveyed the new radicalism. Aiming for the end of slavery ‘and of the evils that it
engendered’, he related Abolition to the agrarian reform proposed by the African-Brazilian
engineer André Rebouças.19
In the view of the abolitionist and positivist thinkers who influenced the Republican
leadership, social engineers appeared as better suited than the lawyers – prized by the Iberian
tradition – to modernize the nation.20 Singled out from the Rio de Janeiro’s Military College,
the Escola Politécnica included, from 1873, a Political Economy chair amongst other
economic driven disciplines. Similar establishments were created in São Paulo (1893) and
Recife (1912) diversifying the economic debate conducted by lawyers or self-taught authors.

The rise of Latin Americanism

An abolitionist and the first Finance Minister of the Federal Republic (1889), Rui Barbosa
helped to establish a Ministry of Industry and implemented a short lived industrial policy.
Considered by some authors as the first planned governmental action in this sector, Barbosa’s
policy, albeit flimsily executed, foreshadowed development theories. 21 New Republican
governments also enhanced relations with neighbouring nations. Pan-Americanism and
international law substantiated the new intellectual global context. Siting a Pan-American
Conference (1906) and the First Congress of Americans Jurists (1912) in Rio de Janeiro
reinforced ties with Washington. Thereafter, trade, banking and diplomatic negotiations led
by the United States gained ascendancy in Brazil, to the detriment of France and England.22 In
reaction to the new international order, the idea of Latin Americanism diffused by Public Law
specialists and diplomats began to take root within Brazilian elites of the First Republic
(1889-1930). Manoel Bonfim expressed a more radical view of Latin Americanism (1905). A
well-travelled social scientist whose works have seen a resurgence of interest in Brazil, he
denounced the tacit agreement between Europe and the United States to endorse the latter’s
economic and diplomatic ‘protectorate’ over Latin America. A promoter of technical
education, he stated that the full political sovereignty of Brazil and Latin American countries
would be only achieved with economic independence and industrialization.23
Meanwhile, the ‘governors’ policy’ emerged portraying the dominance of the regional
oligarchies, especially from the Southeast coffee plantation states, over the Federal
government. Henceforth, the distinction between the ruling classes and the dominant classes
become less sharp. Bowing to the planters’ oligarchies, the Federal government bought and

19 . J. Nabuco, Abolitionism: The Brazilian Antislavery Struggle (Champaign, Ill. 1977);

André Rebouças, Agricultura nacional: estudos econômicos: propaganda abolicionista e
democrática, (1874-1883), (Recife, PE, 1988).
20. Luciano Martins, Pouvoir et Développement Economique, (Paris 1976), 83-87.
21 . Rui Barbosa, Finanças e Políticas da República: Discursos e Escritos, (Rio de Janeiro
1893); P. C. Dutra Fonseca, “Gênese e precursores do desenvolvimentismo no Brasil”,
Pesquisa & Debate, 15 (26), 2004, 225-256.
22 . L. Bethell, “Brazil and Latin America”, Journal of Latin American Studies, 42 (3), 2010,
457-485.
23 . Manoel Bonfim, América Latina: Males de Origem (Rio de Janeiro 1993) 130

6
stocked coffee in order to ensure a profit margin for the producers. From then onwards a
subsidizing policy, to the agro-export sector’s benefit, was established, reinforcing dominant
ideas about the country’s natural comparative advantage and ‘agricultural vocation’.24
At the turn of the nineteenth century, the Argentinian boom gave rise to a rivalry
between the two countries. Facing the emergence of Buenos Aires as a focus of South
Atlantic investment and European immigration, the Federal and the São Paulo state
governments undertook urban and economic reforms. Far-reaching sanitation and re-
urbanization works transformed Rio de Janeiro and Santos into modern port cities. At the
same time, the Ministry of Industry requested an economic inquiry in order to display updated
data to investors and immigrants’ agents. Ultimately, the work’s six volumes of statistics and
surveys formed the country’s first economic and industrial census (1906), which informs most
research even today.25 After the end of slavery, the wage-labour force and mass immigration
expanded the consumer market. Textiles, amounting to a third of the imports during the
second half of the nineteenth century, as well as shoes, beer and tobacco products were
substituted by national production. 26 The amount of small and middle industries in the
Southeast States revealed by the 1906 Census surprised some observers, giving rise to more
consistent discussions about industrialization policies.27
Federalism equally favoured regional research. Capistrano de Abreu, who authored the
introductory essay for the 1906 economic census, extended his research in a work destined to
become a major regionalist history reference (1907). Arguably comparable to F.J. Turner’s
classic essay on the American Frontier, Capistrano’s approach emphasized the ranching
frontier in the North-East backlands (Sertões) along the São Francisco valley and beyond, at
the core of the settled Brazilian territory. 28 Comprehending economic history and human
geography, his work outlined a territorialized interpretation of the history that excluded the
South Atlantic network. Followed then and now by most of Brazil’s historians and by
Brazilianist authors from Europe and America, such an approach confines Brazil’s colonial
past to the Portuguese America territory. The defining Atlantic Slave trade and the three
centuries long direct links with Portuguese Africa, particularly in the Gulf of Guinea and
Central West Africa, still present in Varnhagen’s Historia, are absent of Capistrano’s work
(1907, 1999), which quotes a sole indirect reference on Angola.

24 . Gilberto Maringoni, “Simonsen versus Gudin, a controvérsia pioneira do

desenvolvimento”, Desafios do desenvolvimento, IPEA, 2012, 73 (9), accessed in February
2015http://ipea.gov.br/desafios/index.php?option=com_content&view=article&id=2801:catid
=28&Itemid=23

25. O Brasil, suas riquezas naturais, suas indústrias, (Rio de Janeiro, 1907-1909, 6 tomes).
26 . A. V. Vilela & W. Suzigan, Política do governo e crescimento da economia brasileira,
(Brasília, D.F. 2001).

27 . Nícia Vilela Luz, A luta pela industrialização do Brasil, (São Paulo, 2nd edition, 1978),
142-147.

28 . J. Capistrano de Abreu, Capítulos da História Colonial, (Rio de Janeiro, 1907),

Chapters of Brazil's colonial history, 1500-1800, (New York, 1997). F.J. Turner, “The
Significance of the Frontier in American History”, Report of the American Historical
Association , Chicago, 1893, pp. 199-227.

7
 Best known for his comprehensive research on mining history and legislation in Brazil
(1904-1905), João Pandiá Calogeras, a Finance Minister, wrote an important book on
monetary policies (1910) and Formação Histórica do Brasil (1930) which contains chapters
on economic subjects and brought in the notion of “Formation”.29 Refined by Caio Prado
Junior (1942), Antonio Candido (1959) and Celso Furtado (1959), the concept of ‘formation’
involves critical analysis of the colonial past and of preceding Brazilian historians.30
From a wider perspective, the Portuguese historian J. L. de Azevedo studied
Portuguese America and the scope of Lisbon’s ultramarine economy (1929). Versed in
Brazil’s history and close to Capistrano de Abreu, to whom he dedicated his book, Azevedo
describes the central economic cycles of Portugal’s overseas commodities (Asian pepper,
African gold and Brazil’s sugar (seventeenth century), gold and diamonds (eighteenth
century). 31 Most of the following Brazilians authors adopted that cycle scheme. Roberto
Simonsen’s História Econômica do Brasil (1937), the first book to hold this title, adapted
Azevedo’s analysis, dismissing the Asian and African stages and incorporating the sixteenth
century Brazil wood trade as well as the nineteenth century coffee exports, as the first and the
last of the Brazil’s commodity cycles. 32 Other authors, as J.F. Normano (1935), added a
rubber cycle at the turning of the nineteenth century and shorter cycles of tobacco, cotton,
cacao. 33 It is also currently suggested that from 1970 onwards Brazil initiated a soybean
cycle.
Later works demonstrated that the gold cycle changed Portuguese America
substantially: it supplanted and reorganized other regional activities, nurturing an internal
market, a ‘dynamic centre’ across the inland mining areas (Furtado 1959). By the same token,
researchers showed that the sugar-cane economy has a much larger range and remained
profitable throughout the centuries, including during the period of the gold cycle (Schwartz
1985). 34 Or else they argued that the 1550-1850 sugar, gold mining and coffee activities
relied upon the flow of enslaved Africans provided by the Luso-Brazilian South Atlantic
network. Therefore, a major three-century long slave trade cycle yielded the development of
all export products, which constitute sub-cycles, in Brazil’s territory. Nevertheless, tellingly
and easily adaptable to Lesson Plans, the traditional cycle model is widely taught in
Brazilian’s schools and faculties as well as in history classes abroad. Commodity and
environmental studies emerged with Freyre’s research on the sugar cane monoculture and the
devastation of the Northeast coastal forest (1937), along with Taunay’s extensive work on

29 . João Pandiá Calogeras, La Politique monétaire du Brésil (Rio de Janeiro 1910),

Formação Histórica do Brasil (Rio de Janeiro 1930).

30 . Caio Prado Junior, Formação do Brasil Contemporâneo (São Paulo 1942); Antonio
Candido de Mello e Souza, Formação da Literatura Brasileira – Momentos Decisivos, (São
Paulo 1959); Celso Furtado, Formação Econômica do Brasil, (Rio de Janeiro 1959; Otília
and Paulo Eduardo Arantes, Sentido da Formação, (Rio de Janeiro 1997).

31 . J. L. de Azevedo, Épocas de Portugal Econômico, (Lisbon 1929).

32 . Roberto Simonsen, História Econômica do Brasil 1500-1820 (São Paulo 1937).

33 . João Frederico Normano, Brazil, a study of economic types (Chapel Hill, N.C. 1935)
34 . Stuart B. Schwartz, Sugar Plantations in the Formation of Brazilian Society, Bahia 1550-
1835 (Cambridge 1986).

8
coffee in Brazil (1929-1941) and Alice Canabrava’s book on the cotton plantation (1951).35
Partly inspired by those works and by concerns over the Amazon ecosystem, Warren Dean
wrote his masterful book (1995) on the destruction of the Atlantic forest during the colonial
and national periods.36

The Metabolization of the territorial labour market

The migration of rural workers from the Northeast States to São Paulo’s coffee frontier
surpassed the entry of immigrants around 1930.37 After the centuries of the Atlantic Slave
Trade and the mass immigration from the turning of the nineteenth century, the Southeast
plantations relied predominantly upon Brazilian workers, metabolizing the territorial labour
market. In this context, the establishment of a Ministry of Labour handling official trade
unions (1930), as much as the creation of a minimum wage for urban workers (1940) and a
social insurance system, helped to cope with the emerging working class. The Vargas regime
(1930-1945) strengthened the Federal administration and promoted industrialization. One
central achievement of Vargas' policy was the building of the heavily subsided Volta Redonda
CSN steel mill (1941). Bringing state investment to basic inputs of production, a typical
feature of the import substitution process in Brazil, CNS turned into a symbol of the
developmentalist policy, along with the State-owned mining company Vale do Rio Doce
CVRD (1942), as well as the Petrobras (1953) hydrocarbon company and the Federal
Development Bank BNDE, later BNDES (1952), created in the second Vargas administration
(1951-1954). 38 The National Institute of Statistics (IBGE) established in 1938 and the
organization of the 1940 Census launched a new age of demographic and economic data.
Thanks to the economist and statistician Giorgio Mortara, a refugee from Fascist Italy who
joined the IBGE in 1939, data collection and analysis were enhanced and standardized. In
addition to the updated statistics collected in systematic surveys, the 1940 Census revised data
from the existing 1872, 1900, 1920 Censuses.
At this crossroads in the 1930s, marked by the decline of the old regional oligarchies, the
emergence of interregional migrations and a new centralized regime, the seminal books of
Gilberto Freyre, Caio Prado Junior, and Sérgio Buarque de Holanda came to light. Regularly
reedited and debated since, and translated in several languages, these works remain formative

35 . A. de E. Taunay, História do Café no Brasil, (Rio de Janeiro 1929-41), 11 vols.; G.

Freyre, Nordeste – Aspectos da influência da cana sobre a vida e a paisagem do Nordeste do
Brasil, (Rio de Janeiro 1937); Alice P. Canabrava, O Desenvolvimento da Cultura do Algodão
na Província de São Paulo, 1861-1875 (São Paulo 1951).

36 . Warren Dean, With Broadax and Firebrand: The Destruction of the Brazilian Atlantic
Forest, (Los Angeles, Cal., 1995).

37 . D. Graham & S.B. de Holanda Filho, Migrações internas no Brasil: 1872-1970 (Brasília
1984).

38 . Olivier Dinius, Brazil's Steel City: Developmentalism, Strategic Power, and Industrial
Relations in Volta Redonda, 1941-1964, (Stanford, Cal. 2011).

9
for Brazil’s students and for foreign Brazilianists.39 Freyre’s study (1933) of private life and
societal relations in cane sugar plantations between the sixteenth and nineteenth centuries
helped to understand slave life and sugar-mill management. Moreover, his book emphasized
the social viability of the Luso-Brazilian miscegenation. Obsessed with Afro-Brazilian
demographic growth, Oliveira Vianna, a leading political thinker, commenting on the 1920
Census, had been concerned about the need of ‘whitening’ the nation. Opposing these
dominant ideas, Freyre outdid the century-old debate on the unviability of the post-Slave trade
national society and the need for European immigration.40 By these means he also shaped the
ideology of Brazil as a non-racist nation. Renewing connections with Portugal’s
historiography, his later works conjectured those features as inherent to Portuguese
colonization, thus revamping Lisbon’s colonialist propaganda in Africa in the 1960s.
Writing on culture and social life, Sérgio Buarque de Holanda uncovered the historical
traits that thwarted democracy in Brazil in the aftermath of the 1930 Revolution (1936).
Among other works, he wrote on river transportation in colonial times (1945) and on São
Paulo’s Bandeirantes and their enslaving raids and expeditions across the South America
Lowlands (1957).41 More influential for economic historians and economists, Caio Prado Jr
introduced a Marxist version of Brazil’s history (1933) and broadened this in his best-known
work analysing the colonial process (1942) and in his economic history book (1945, 1970),
covering a larger period and including twentieth century industrialization.42 It should be noted
that Prado’s economic history was first published in Mexico by the Fondo de Cultura
Economica, which also issued Freyre’s Interpretación del Brasil (1945), and Josué de
Castro’s work on food in the tropics, the first Brazilian book on global history (1946).43 In the
same way, the Fondo translated to Spanish modern editions of Marx (1935), Max Weber
(1944), Keynes (1945), Adam Smith (1958) and other classical authors. Intelligible for
Portuguese speakers, these translations offered a broader spectrum of historical and economic
knowledge to Brazilian readers. José Medina Echevarria, a Spanish republican refugee
sociologist and a Fondo editor, was later the Social Science Director at the CEPAL where he
worked with Furtado and Fernando Henrique Cardoso.

Developmentalism and industrialization

Joining Raul Prebisch in Santiago in 1949, at CEPAL’s beginnings, Furtado studied the
development of the constituent countries. Whereas the Pan-Americanist writers of the early

39. G. Freyre, The Masters and the Slaves (New York 1946; or. edn. 1933); S. Buarque de
Holanda, Roots of Brazil (Notre Dame,IN. 2012; or. edn. 1936); C. Prado Júnior, Colonial
background of modern Brazil, (Berkeley, Cal., 1967).

40 . F. J. de Oliveira Viana, Evolução do povo brasileiro, (São Paulo 1923) 99-101.

41. Sérgio Buarque de Holanda, Raízes do Brasil (Rio de Janeiro 1936), Monções (Rio de
Janeiro 1945), Caminhos e fronteiras.(Rio de Janeiro 1957).

42 . Caio Prado Junior, A Evolução Política do Brasil – Colôna e Império (São Paulo 1933),
História econômica do Brasil (São Paulo 1945, enlarged edn. São Paulo 1970)
43 . Gilberto Freyre, Interpretación del Brasil (Mexico 1945); Josué de Castro, La
alimentación en los Trópicos, (Mexico 1946).

10
twentieth century had focused upon institution-building and continental law, CEPAL’s
economists and sociologists did more policy-oriented research, planning the governance and,
occasionally, the government of their own countries. Former CEPAL researchers such as
Fernando Henrique Cardoso (twice the country’s president), Celso Furtado, José Serra and
Francisco Weffort (all leading ministers and high-ranking officials), had a critical role in
economic and social policies, not to mention their support to the Mercosur.
Furtado's book on Brazil’s economic formation (1959) gathered and analysed
economic data on the colonial and national periods. He underscored the central role of
eighteenth century gold mining in the making of a continental Brazilian market, playing down
explanations based on the ranching frontier (Capistrano), sugar mill communities (Freyre) or
coffee plantations (Prado Junior). Examining the 1930s administration, Furtado introduced a
Keynesian analysis of the Vargas expansionary fiscal policy and of the purchase, stockpiling
and destruction of coffee. His book presented CEPAL’s analysis of import substitution
industrialization, which became a dominant notion, especially after Conceição Tavares’
extensive study on the subject (1972).44 Furtado’s tight and engaging writing style added to
his success with readers in Portuguese and in numerous translations.45
Gavin Kitching rightly observed that emphasis on the colonial past embodies a
distinctive trait of Latin American dependency theory compared to Russian development
ideas of the turn of the twentieth century. Still, the assessment of slavery’s enduring
consequences differentiates most of the Brazilian writings from corresponding development
studies undertaken in other Latin American countries.46 To be sure, as much as Prado, Castro
and Cardoso, Furtado underlies slavery's economic and social legacy in contemporary Brazil.
Drawing on recent surveys on the topic, many authors of the new generation equally stress
such historical parallels, as do Jesse Souza (2003) and Adalberto Cardoso (2010), in their
significant books on the making of social citizenship and of the working society in
contemporary Brazil. 47
It is not coincidental that Furtado's book, just as Candido’s study of the formation of
the Brazilian literature, was published in 1959, in a period of democracy and economic

44 . Maria da Conceição Tavares, Auge e declínio do processo de substituição de importações

no Brasil, (Rio de Janeiro 1972).

45 . 'The tightness and compression of Furtado's style of writing is admirable. He eschews

anecdote, and reduces description to the minimum necessary to his exposition of causal
relationships”, Warren Dean, “The Economic Growth of Brazil, by Celso Furtado', Luso-
Brazilian Review, 2 (2), 1965, 105-107. Quote from p. 107.

46. Gavin Kitching, Development and Underdevelopment in Historical Perspective (1982),

(London 2012) 152-160.

47 . Jessé Souza, A construção social da subcidadania: para uma Sociologia Política da

modernidade periférica (Belo Horizonte, M.G. 2003); Adalberto Cardoso, A construção da
sociedade do trabalho no Brasil: uma investigação sobre a persistência secular das
desigualdades, (Rio de Janeiro 2010). In the same perspective, Francisco de Oliveira 1972’s
seminal essay demonstrated the connection between rural poverty, a slavery legacy, and the
urban economic growth, A Economia brasileira: crítica à razão dualista (Petrópolis, R.J.
1972).

11
growth that fortified optimism about the country’s destiny. 48 Shifting from the previous
economic pattern based on state or national entrepreneurship, the Kubitschek presidency
(1956-1961) encouraged American and European investments, especially in the automobile
industry. The inauguration of Brasilia (1960) and the consolidation of industrial production
seemed to confirm the country’s positive views. Published in 1961, the often cited book of
Vilela Luz reviewing the economic policies from 1808 to 1930, is significantly entitled ‘The
Struggle for Brazil’s industrialization’, suggesting that the expansion of domestic industry
was the main step towards the progress. 49
In the 1950s and early 1960s, the reformist and Varguist platforms were based on
three pillars designed to ensure national sovereignty and development: state-led
industrialization associated with foreign investments; the ‘Base Reforms’, mainly the Land
Reform, backed by the progressive movement and by organized labour; and the surge of a
‘national bourgeoisie’, supposedly supportive of such reforms. Cardoso questioned the
significance of the national bourgeoisie’s role in the reform movement (1964), an
interpretation that he expanded in a prominent book co-written with Faletto while they were at
CEPAL (1969).50 Another influential book of this period is Ignacio Rangel’s work (1963) that
set the basis of the inertial inflation interpretation in Brazil.51 Expanded in depth by others
authors, such an analysis was put in practice by Edmar Bacha in the successful Real Plan
enacted by Cardoso, then Finance minister (1993). 52 This stabilized the economy and
controlled the half-century-long inflationary process.

Foreign approaches and the expansion of research

As in other Latin American countries, French and American authors and theories considerably
influenced Brazil’s post-war historiography. Fernand Braudel taught at the University of São
Paulo (1935-1937, 1947) while his disciple Alice Canabrava, was appointed in 1951 to the

48 . Antonio Candido’s, Formação da Literatura Brasileira (Rio de Janeiro, 1959) is,

arguably, the main work on Brazil’s litterary history.

49 . Nícia Vilela Luz, A luta pela industrialização do Brasil (São Paulo 1961)

50. F.H. Cardoso, Empresário industrial e desenvolvimento econômico no Brasil, (São Paulo
1964); F.H. Cardoso and Enzo Faletto, Dependency and Development in Latin America,
(Berkeley, Cal., 1979). Cardoso’s later presidencies (1995-1999 and 1999-2003), as debatable
as they can be, should not overshadow his prominent role as sociologist and political scientist
in Brazil.

51 Ignácio Rangel, A Inflação Brasileira (Rio de Janeiro 1963).

52 . Yoshiaki Nakano, « Recessão e inflação », Revista de Economia Política, v. 2 (2), 1982,

pp. 133-137; Luiz Carlos Bresser-Pereira e Y. Nakano, "Fatores aceleradores, mantenedores e
sancionadores da inflação" (1983), Revista de Economia Política v. 4 (1) 1984, pp. 5-21;
Francisco Lopes, "Inflação inercial, hiperinflação e desinflação". Revista da ANPEC, n.7,
1984, pp. 55-71; Pérsio Arida; André Lara Resende, “Inertial inflation and monetary reform
in Brazil”, paper prepared for the Conference "Inflation and Indexation", Institute of
International Economics, Washington. D. C., December, 6-8, 1984, pp. 1-31.

12
economic history chair as the first female professor. She authored pioneering works on the
Atlantic world clearly affiliated with the Annales School. Moreover, Magalhães Godinho and
Frédéric Mauro, who taught in São Paulo, as well as Pierre Chaunu, the Annales’ authors
whom Braudel had advised in their magisterial surveys on the Iberian empires, were generally
read in Brazilian universities. As other economists and historians of the Annales’ second
generation, all three authors were followers of Earl J. Hamilton’s writings and methods, a
factor that accounted for the quantitative drive of many Annales essays and inflected on
Iberian and Latin American economic history. Vitorino Magalhães Godinho wrote critical
surveys on the Portuguese American economy.53 Frédéric Mauro’s book on the South Atlantic
as well as his many works on economic history (1960, 1970), introduced subjects
subsequently developed by his numerous, mostly Brazilian, PhD candidates. His 1973
collective book on Brazil’s quantitative history inspired inquiries into prices conducted,
among others, by Katia Mattoso, Yeda Linhares, Barbara Levy and Lahmeyer Lobo. 54 The
latter’s two-volume book on Rio de Janeiro’s nineteenth and twentieth century wages, prices
and companies, represents one of the most accomplished works of the kind in Brazil (1978).55
An Annales special issue on Brazil’s history (2006, n. 2) illustrated the new stage of French-
Brazilian collaboration in history and economic history.
American economic history scholarship about Brazil was not new, as illustrated in the
work of Alan Manchester (1933) and Alexander Marchant (1940). 56 However, it was
Tannenbaum’s (1946) endorsement of Freyre’s ideas – when the Jim Crow Laws began to be
more criticized ̶ that enthused studies in American universities on slavery, labour and race
relations in Brazil.57 In addition to the books of Stanley Stein and Warren Dean on coffee
plantations, or Stuart Schwartz’s works on sugar mills and the slave system, other surveys
contributed to understanding of the labour market. As was the case with the essays on urban
slavery by Mary Karash, Sandra Lauderdale Graham and A. J. R. Russell-Wood; the work of
Herbert Klein and Dale Tomich on comparative slave systems; Herbert Klein and David Eltis
on the slave trade, Colin MacLachlan, Barbara Sommer and John Monteiro on the Indian

53 . Vitorino Magalhães Godinho, « Problèmes d'économie atlantique. Le Portugal, flottes du

sucre et flottes de l'or (1670-1770) », Annales, v. 5 ( 2), , pp. 184-197, Prix et Monnaies au
Portugal, 1750-1850 (Paris 1955), Os Descobrimentos e a Economia Mundial, 2 vols.,
(Lisbon 1963).

54 . Frédéric Mauro, Le Portugal et l’Atlantique au XVIIe siècle, 1570-1670, étude

économique (Paris 1960), Etudes économiques sur l’expansion portugaise 1500-1900, (Paris
1970), (ed.) Histoire quantitative du Brésil 1800-1930 (Paris 1973).

55 . Eulália Lahmeyer Lobo, História do Rio de Janeiro - do capital comercial ao capital

industrial e financeiro, 2 vols. (Rio de Janeiro 1978).

56 . Alan K. Manchester, British preeminence in Brazil, (Chapel Hill 1933). Alexander

Marchant, The Economic Relations of Portuguese and Indians in the Settlement of Brazil,
1500-1580, (Baltimore 1940). Manchester survey inspired R. Graham’s, Britain and the Onset
of Modernization in Brazil, 1850-1914 (Cambridge 1968).

57 . Frank Tannenbaum, Slave and citizen, the Negro in the Americas (New York 1946).

13
slavery; Thomas Skidmore and Carl Degler on racial relations; and John French and Barbara
Weinstein’s researches on trade unions and the working class. Spurred by growing academic
interest and, especially, research support for Latin American studies after the Cuban
Revolution, surveys were also undertaken on Brazilian’s State enterprises and
industrialization, (Steven C. Topik, Warren Dean, Albert Fishlow), long-term economic
development (Nathaniel Leff, Werner Baer) or regional economies (A. J. R. Russell-Wood,
Peter Eisenberg, Thomas Holloway, Robert Slenes, Robert Levine, Joseph Love, Richard
Morse, Douglas Libby, Laird Bergad, Bert Barickman.58
Two generations of Brazilian historians such as João J. Reis (1993, 2008), Junia
Furtado (2009), Marcus Carvalho (2002), Sidney Chaloub (1990), Rafael Marquese,
Roquinaldo Ferreira, Mariana Cândido, Maria Helena Machado (2010, 2014) and many
others, studied New-World slavery or African economic history in North American
universities. Economists who taught in Rio universities and later played a prominent role in
the Cardoso government (Winston Fritsch, Gustavo Franco, Pedro Malan and Edmar Bacha)
researched on economic history in Economics Departments of American institutions.
Typically, the economic history works of Wilson Suzigan, Anibal Vilela, Flávio Saes, Tamás
Szmrecsányi, who founded in 1993 the Association of Economic History Researchers
(ABPHE), rely on studies undertaken in both countries.
Werner Baer’s survey of the Brazilian economy from the colonial period until today,
regularly reedited and updated with Brazilian collaborators in American and Brazilian
editions is often used as textbook, illustrating academic cooperation between the two
countries (1979, 2014).59 The best example of American-Brazilian joint research however is
the extensive Herbert Klein (UCLA) and Francisco Luna (USP) co-authorship that resulted,
among other significant works, in their above-mentioned 2014 book on Brazil’s social and
economic history from 1889 to 2011.
Luso-Brazilian collaboration on colonial economic history also generated fruitful
research as shown by the comments of Valentim Alexandre (1993) and Jorge Pedreira (1994)
on the influential books of Fernando Novais (1979) and J. Jobson de Arruda (1980), and the
ensuing discussion of the concept of ‘colonial crisis’ published in a special issue on Brazil in
The Hispanic American Historical Review (2000, n. 4).60
Broader sharing of data has improved economic history in recent years. The
Government-led and UNESCO-supported Projeto Resgate inventoried and digitized most of
Portuguese archival documents on the colonial period. Other countries’ archives, such as
those of the Netherlands or Angola, are in process of digitalization. The same may be said of
the Trans-Atlantic Slave Trade Database, which is being translated into Portuguese and has
Brazilian historian Manolo Florentino as one of its main collaborators. Accessed by many
researchers, such data has renewed colonial economic history, as evidenced by the works of

58 . On the growth of the United States funding for Latin American studies in the aftermath of
the Cuban Revolution, see Thomas E. Skidmore, “Studying the History of Latin America: A
Case of Hemispheric Convergence”, Latin American Research Review, 33 (1), 1998, 105-127.

59 . Werner Baer, The Brazilian economy : its growth and development (Columbus, Ohio
1979), A Economia Brasileira, 3rd ed. (São Paulo 2009).

60 . Fernando A. Novais, Portugal e Brasil na Crise do Antigo Sistema Colonial , 1777-1808,

(São Paulo 1973); Jorge M de M.V. Pedreira, Estrutura Industrial e Mercado Colonial.
Portugal e Brasil, 1780-1830, (Lisbon 1994).

14
Ângelo Alves Carrara on the Crown’s Treasure in seventeenth and eighteenth centuries
Portuguese America (2009), A.C. Jucá de Sampaio on Rio de Janeiro colonial merchants
(2007), Rafael Chambouleyron (2011) on the Amazon economic exploitation or Helen
Osorio’s surveys of South Brazil’s ranching activities (2007).
Likewise, National Household Surveys (PNADs), realized by the IBGE, enabled more
detailed research on social data, especially from 1976 onwards, when the survey covered most
of the country’s regions and included data on income distribution and racial inequalities.
Using the 1976 PNAD household sampling, the first to include skin colour among their
criteria since the 1950s Census, Carlos Hasenbalg demonstrated that, despite two and half
decades of economic growth and urbanization, ethnic inequality persisted (1979). Along with
Afro-Brazilian and progressive movements, other studies deepened these findings, launching
a debate that led the government to pass, in August 2012, a law mandating quotas for entry of
black, mixed-race and Amerindian students in federal universities and technical schools.
Online data are much more accessed since, as many other Federal institutions, the
IBGE, Central Bank and the Congress maintain sites with historical series. Above all, the
required online presentation of all Government-funded Master and PhDs theses, greatly
facilitates economic history researches.
To some extent, regionalist novels enlarged Brazilians’ knowledge of the country’s
ethnic and economic diversity. Representative of this literary movement are Lins do Rego’s
autobiography Plantation Boy (1932), on a sugar-mill community; the social novel of
Graciliano Ramos Barren Lives (1938), describing peasant migration caused by the Northeast
droughts; the historical novel Time and the Wind (1949-1951), by Erico Verissimo, narrating
the gaucho’s life in the Rio Grande do Sul’s past; or the best-selling novel by Jorge Amado,
Gabriela, Clove and Cinnamon (1958), on a Bahia town transformed by the cacao crop
expansion. Studied in secondary school, turned into movies or into telenovelas these novels
have had long-standing repercussions. From a different perspective, generally highly popular
telenovelas, or soap operas, have had a key impact on the country’s demographic transition.
Following Elza Berquo’s findings on the drop of the fertility rates, Faria and Potter
demonstrated that soap operas, favourably portraying small and less authoritarian families,
have induced couples to choose fewer children.61

Dictatorship, democracy, economic growth and income inequality

Across the dictatorship and the succeeding democratic regime, three main issues related to
the country’s past involved economic history research. The first was the Agrarian Reform and
the agro-export sector. After the Varguist government’s overthrow by a Washington-
supported military dictatorship (1964-1985), Prado Jr reinstated criticism of the Brazilian
Communist Party (PCB) endorsement of the Komintern’s thesis of an agrarian ‘feudal’
system in Brazil.62 Though affiliated to the PCB, Prado had his own view of the country’s
problems. In his perspective, the colonial economy, rooted in merchant capitalism and
Atlantic slavery, was integrated in world trade from the sixteenth century. Therefore,
programs of land reform promoted by the PCB and its allies, seemed ineffective. The
improvement of social conditions in the countryside, brought about by rural workers’

61. Vilmar Faria and J. Potter, “Television, Telenovelas, and Fertility Change in North-East
Brazil”, in Richard Leete (ed.), Dynamics of Values in Fertility Change, (Oxford 1998).

62 . Caio Prado Jr, A Revolução Brasileira, (São Paulo 1966).

15
organizations, would enlarge the internal market, favouring national industry. By contrast,
other social activists and authors, galvanized by the impact of the Cuban Revolution,
emphasized the major potential of land reforms. Historical and agrarian research by Marxist
writers such as Alberto Passos Guimarães (1963) and Jacob Gorender (1978) was influential
within that current, which included Catholic activists. Indeed, created in 1975 by the Catholic
Bishops Conference (CNBB), the Pastoral Land Commission backed Land Reform
organizations, later converted into the Landless Movement (MST). CNBB’s opposition to the
dictatorship – a distinctive characteristic of Brazil’s Catholic hierarchy in the 1970s
authoritarian South America – evolved towards adoption of the developmentalist thesis.
Meanwhile, peasants and rural workers' demonstrations, sometimes bloodily repressed by
local police, posed the agenda of land reforms to the Federal Government. Exposing the
double feature of the post-slavery agrarian structure and the above debate, there are now two
Ministries of rural affairs. The traditional Agriculture Ministry (1860) supports the latifundia-
based agribusiness, essential to the country’s exports, but the new Ministry of Agrarian
Development (1999) was designed to provide rural properties to landless families, a
politically sensitive issue. As demonstrated by several authors, the coupling of the two
agrarian policies has been one of conflicting themes of the Workers’ Party presidencies since
2003.63
Industrial policy was another key point of the economic history debates, as state
entrepreneurship, mainly in Geisel’s dictatorship (1974-1979), expanded in many areas.
Accordingly, state institutions increased investments in infrastructure, basic inputs and the
capital goods sector, doubling the number of enterprises owned by the federal government
between 1964 and 1974. Subsequently, Antônio Barros de Castro (1985) and some other
development economists assumed that the investments made by the Geisel administration
would launch a new wave of industrialization and growth. However, the external debt crisis,
initiated in 1982 in Mexico struck also Brazil, plunging the country into a political and
economic crisis. The evolution of foreign debt, coincident with Brazil’s history since the
independence, turned into one central research topic of the period.64 Since 2005, when Brazil
anticipated its reimbursements to the IMF and increased its foreign-exchange reserves, the
subject has been less debated. Privatizations of state enterprises started in 1990 and expanded
during the Cardoso presidencies (1995-2003). Some Vargas era economic institutions such as
CSN and CVRD integrated the privatizations achieved in 1990-2012. Considered by Klein
and Luna (2014) as one of the largest in the world, the privatizations aroused controversies,
even within the government. Thus, in his last book, L. C. Bresser, then Minister of Sciences
(1999), argued that Cardoso policies were ‘explicitly projected to close out the Vargas era’, in
order to globalize Brazil’s economy under United States’ hegemony.65 Lula’s presidencies

63 . P. Nakatani, R. N. Faleiros, & N. C. Vargas, “Histórico e os limites da reforma agrária na

contemporaneidade brasileira. Serviço Social & Sociedade, 110, 2012, 213-240. MOTTA,
Márcia Motta & P. Zarth (eds.), Formas de resistência camponesa: visibilidade e diversidade
de conflitos ao longo da história (Brasília 2008).

64 . Leonardo Weller, “Rothschilds’ Delicate and Difficult Task”: Reputation, Political

Instability, and the Brazilian Rescue Loans of the 1890s”, Enterprise & Society, 2015, 1-32
forthcoming; Kurt Kurt von Mettenheim, Monetary Statecraft in Brazil (London 2015)
forthcoming.

65 . L.C. Bresser Pereira, A Construção Política do Brasil 318-319

16
(2003-2011) partially reversed this trend, increasing infrastructure investments; Petrobras
control over the pre-salt huge oil reserves; reinstating shipbuilding; and, above all, enlarging
the domestic market through a dynamic policy of social welfare comprising increases in the
minimum legal wage and the bolsa família, or family allowance.66 Nevertheless, the Real’s
overvaluation, and reliance upon commodity exports, reduced the external competitiveness of
the industrial sector.67 Early twentieth century ideas of planters and export-merchants about
the agricultural vocation of the country surfaced again.
The third main issue researched and debated during recent decades is income
inequality, a chronic problem in Brazil. Despite repression from the dictatorship, Minas
Gerais and São Paulo’s metalworkers launched strikes in 1968 against low wages, originating
a political and social movement that contributed to the founding of Lula’s Workers Party PT
(1979). Intermingling academic research with social engagement, research papers by
Brazilian and American economists, one of them quoted by Robert MacNamara, then World
Bank president, affirmed that economic growth provoked a substantial concentration of
income, contradicting the dictatorship propaganda. 68 The Research Institute of the trade-
unions (DIEESE) challenged official data on the 1973 inflation rate and the World Bank later
corroborated its analysis. From then onwards government, academic and trade unions
researches centres have debated the subject. Attaining its highs from the late 1970s until the
mid-1990s, the concentration of income declined after the Real Plan and experienced a steady
fall after 2002. 69 Academic researchers, federal government and non-governmental
institutions studied anti-poverty policies in Brazil including bolsa família, the largest
conditional cash transfer program in the world. 70 The emergence of a ‘new middle class’
(Neri, 2011) and the attachment of the votes of organized labour and the poor to the PT

66 . R. Paes de Barros, Mirela de Carvalho, S. Franco, R. Mendonça, “Uma análise das

principais causas da queda recente na desigualdade de renda brasileira”, Texto 1203, Ipea,
(Brasília, 2006).

67 . IEDI, Desindustrialização e os dilemas do crescimento econômico recente (São Paulo

2007).

68 . A. Fishlow, “Brazilian size distribution of income”, American Economic Review, 62, (2),
1972, 391-402; Rodolfo Hoffmann & J. C. Duarte, “A distribuição da renda no
Brasil”, Revista de Administração de Empresas”, 12, (2) 1972, 46-66; J. S. Leite Lopes,
“Sobre o debate da distribuição da renda: leitura crítica de um artigo de Fishlow”, in R.
Tolipan & A.C. Tinelli (eds.), A controvérsia sobre distribuição de renda e desenvolvimento
(Rio de Janeiro, 1975); Rodolfo Hoffmann, “Distribuição de renda e crescimento econômico”,
Estudos Avançados, 15 (41), 2001, pp. 67-76

69 . Marcos Mendes, Por que o Brasil cresce pouco ? (São Paulo 2014) 74-81

70.Accessed in January 2015 http://www.worldbank.org/en/news/feature/2014/03/22/mundo-

sin-pobreza-leccion-brasil-mundo-bolsa-familia.

17
candidates, gives to ‘Lulism’ (Singer, 2009) a broader and transforming dimension that
outstrips the legacy of Vargas. 71

Conclusion

Economic history in Brazil is no longer a central research field, as it used to be in the postwar
period up to the 1970s, the years of Prado Jr and Furtado. New disciplinary divisions and
academic specialization have certainly contributed to this. Besides, in most Brazilian
Universities the discipline overlaps with, and is sometimes unduly absorbed by, the history of
economic thought. There are, however, more substantial reasons. Drawing on Leroy-
Beaulieu’s late nineteenth century distinction between ‘exploitation colonies’ and ‘settlement
colonies’, Brazil’s historians have tended to eschew the costal factories or warehouses,
ignoring significant stages of the European merchant capital expansion. In fact, it was the
Atlantic Slave Trade and gold mining that turned Portuguese America's coastal factories and
plantation enclaves into a single colony in the eighteenth century. Conceiving Brazil as a
territorialized entity from the sixteenth century generates a tautological interpretation that
overshadows Southern Atlantic history. 72 The bipolarity between South American slave
production sectors and African slave reproduction areas sustained the colonial spatial matrix
in the South Atlantic until 1850, well beyond Brazil’s independence. Obliviousness to this is a
dismaying tendency in a country where, according to the 2010 Census, more than the half of
its inhabitants are of African descent.
Along the same lines, while tens of Brazilian students wrote their PhDs on Brazilian
history in American universities in the last decades, there is practically no research done by
the Brazilians on North American history. Similarly, China has been Brazil’s first trading
partner since 2009, and yet Chinese history is not taught in secondary schools or, more
seriously, in Brazilian universities, notwithstanding the four-century-long data and
historiography in Portuguese engendered by Lisbon’s dominion over Macau. Such a self-
centred conception of history discourages comparative international studies and perspectives,
hindering the economic history of Brazil itself and preventing the application of Brazilian
ideas in other contexts.

71 . Marcelo Neri, A Nova classe média (Rio de Janeiro 2011); André Singer, “Raízes sociais
e ideológicas do lulismo”, Novos Estudos, v.85, 2009, pp. 83-102.
72. Brazilian history books refer to Portuguese America as the Colonia, with capital C, as if it
was a proper noun.

18