Exchange rate versus tariff policies in Brazil: results from MIBRA-USP, an interrregional applied general equilibrium model of the Brazilian economy

Rocha, Marcelo Theoto and Guilhoto, Joaquim José Martins and Lima, Patrícia Verônica Pinheiro Sales and Casimiro Filho, Francisco and Miranda, Silvia Helena G. de (2000): Exchange rate versus tariff policies in Brazil: results from MIBRA-USP, an interrregional applied general equilibrium model of the Brazilian economy.

Abstract

Since the beginning of the 1990’s Brazil has been experienced an opening process in the economy, which in turn has caused structural changes in the productive structure. In this work it is made an evaluation of the different impacts caused by changes in the exchange rate and in the tariffs over the Brazilian economy and its 5 macro regions. The study is done through the use of an interregional applied general equilibrium model, the MIBRA-USP. The results show that either a devaluation of the exchange rate or an increase in tariffs can cause a rise in the employment level as well as in the economic activity. However, there are differences between the policies, among which it is called attention for the real consumption of the families that decreases with the exchange rate devaluation and increases with higher tariffs.

• Item Type: MPRA Paper
• Language: English
• Keywords: Economic policy, interregional aplied general equilibrium model
• Subjects: C - Mathematical and Quantitative Methods > C6 - Mathematical Methods ; Programming Models ; Mathematical and Simulation Modeling > C67 - Input-Output Models; D - Microeconomics > D5 - General Equilibrium and Disequilibrium > D57 - Input-Output Tables and Analysis; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R15 - Econometric and Input-Output Models ; Other Models

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