ABSTRACT

This chapter discusses some aggregate indicators of the Brazilian economy since 1980. It focuses on the evolution of the macroeconomics as well as some sectoral production indicators. The chapter shows that the fall in absorption occurred mainly in the investment sectors. It analyzes the evolution of agricultural costs. The chapter uses an applied general equilibrium model to make some counterfactual analysis that enhances our understanding about the Brazilian agricultural growth process in the near past. It argues that the adjustment of Brazilian agriculture to the crisis of the 1980s generated the conditions that made it possible for Brazilian agriculture to growth faster than the industrial sector in large part because of a more adverse effect on the industrial demand. There was an important fall in the costs of agricultural production, caused by price declines in the main agricultural inputs.