Trade, protection and competitiveness in Brazil: the case of the auto industry

Chagas, Leonardo (2019) Trade, protection and competitiveness in Brazil: the case of the auto industry. Doctoral thesis, University of East Anglia.

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The question on why, when and how to impose tariff barriers to protect the domestic industry is far from settled. Although different branches of the literature acknowledge that the existence of market failures is a potential reason to protect, the identification and measurement of externalities, for example, is a very difficult empirical task. Thus, theoretical and empirical literature does not offer a satisfactory policy guidance.

However, it is not an assessment of potential market failures such as externalities that should guide policy. More can be said about the different channels through the link between tariff protection/trade liberalization and competitiveness operates. To shed light on these channels we undertake a case study of the Brazilian automotive sector, following an inductive approach and relying on different sources of both qualitative and quantitative data. In this, we ask “Why is the Brazilian Automotive sector not yet competitive after 60 years of protection?”.

The identified channels that could answer our research question can be divided into (i) actions and policies that affect the internal and external scale of domestic production; (ii) variables affecting competition and productivity; (iii) variables affecting the production and absorption of innovation; (iv) institutional aspects and the business environment faced by firms operating domestically.

The results indicate that the structure of protection within the domestic value chain – namely the level of protection for intermediate goods, and the overall business environment, are two relevant aspects potentially affecting the long-term competitiveness of industrial sectors, and that these should be better taken into account in policymaking.

Item Type: Thesis (Doctoral)
Faculty \ School: Faculty of Social Sciences > School of Global Development (formerly School of International Development)
Depositing User: Chris White
Date Deposited: 24 Nov 2020 12:09
Last Modified: 24 Nov 2020 12:09


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