ABSTRACT
The Brazilian crisis assumed a fundamentally economic and political character, although it also had social and even cultural aspects. The decrease in industrial output in early 1964 was due partly to the rationing of electric power, which continued until April or May, and partly to the political crisis Brazil went through at that time. Crisis thus dominated the Brazilian economic scene in early 1965. The decrease in investment opportunities was the most important medium-range structural cause of the Brazilian crisis. Brazilian agriculture has the necessary resiliency to support this double impact—the transfer of income and the loss of labor power. The policy that fought inflation by reducing demand when the inflation was in fact caused by costs resulted in economic stagnation or, more precisely, economic recession. The short-range causes of the economic crisis, and particularly of the recession that began in early 1965, are directly related to the economic policy of the Castello Branco government.
