WAGE INFLATION, FISCAL-POLICIES, AND INCOME-DISTRIBUTION IN BRAZIL

Economic growth in Brazil over the last three decades has been marked by sharp changes in the socioeconomic structure of the nation. The state has played a major role in the growth process, pursuing development strategies aimed at stimulating growth that directly or indirectly affected income distribution. This article presents an empirical model of Brazil's economy that is used to explore the effects of alternative policies and other structural changes. A computable general equilibrium model is used to simulate the impact of increases in money wages, public spending and transfers, and a change in the distribution of labor income. © 1991.