PSL Quarterly Review

Premature deindustrialization and climate change: Global North and South perspectives

2025-04-25T07:52:01+00:00

The present article is an introduction to the special issue of the PSL Quarterly Review organized by José Luis Oreiro (University of Brasília) and Giulio Guarini (Tuscia University) with a selection of the best articles presented in the IV International Workshop of the Structualist Development Macroeconomics Research Group held at University of Brasília (Brazil) from 12 to 14 of June 2024. The articles presented in this special issue are about the relations between premature deindustrialization and climate change which are common challenges both for Europe and Latin America countries. This special issue cooperates for a better understanding of the nature of problems that both regions face.

Economic complexity and international trade: A case study on the State of Goiás (2010-2019)

2025-04-25T08:48:52+00:00

This paper aims to explore the relationship between economic complexity and the productive structure of Goiás, Brazil, particularly in the context of environmental issues within international trade agreements. To this end, the export agenda of Goiás was analysed using the Herfindahl-Hirschman Index to assess the concentration of exports by partners and products. Through the collection of statistical data on the Goiás economy for the calculation of concentration indicators, it is revealed that Goiás’ production structure is concentrated in primary products and mining and it has just a few trade partners, exacerbating its vulnerability to evolving environmental challenges and international regulations. This scenario demands a transition towards low-carbon practices and more sustainable technologies while preserving native vegetation and its ecosystem services. For large commodity producers like Goiás, this necessitates continuous diversification and sophistication of the productive structure to enhance economic complexity.

Environmental policy and green export competitiveness: The enhancing effect of economic complexity

2025-04-25T20:14:24+00:00

Development depends on a nation’s ability to produce sophisticated goods, making economic complexity crucial. Considered as an ecological sophistication of technological, social, and cultural factors, ecological structural change, the core of Green New Developmentalism, can address environmental and socio-economic challenges, particularly in developing countries. As green policies can act as drivers of structural changes, eco-innovations, and international green competitiveness, this paper examines the impact of green policies on green export competitiveness, testing the strictly strong version of the Porter hypothesis and evaluating the moderating effect of economic complexity and pollution intensity. This paper used a panel dataset covering 40 OECD countries from 1990 to 2016, and the results indicate that stringent environmental regulations positively impact green exports only in the medium term. When the moderating factors are introduced, stringent green policies become effective in the short term, and their positive impact increases with the country’s economic complexity and pollution intensity. Combining stringent environmental policies and green economic sophistication could allow for integrating economic growth, sustainable production, and international green competitiveness.

Endogenous income elasticities

2025-04-25T20:35:35+00:00

This paper deepens the analysis of the income elasticities of import and export demand in relation to the real exchange rate (RER) within a balance of payments constrained growth framework. It identifies how the RER can affect these elasticities and explores the resulting implications. A key highlight is the RER’s ability to induce structural changes toward more complex and technology-intensive sectors. To illustrate this, a formal multisectoral model is presented, demonstrating the conditions under which a higher RER can alleviate external constraints. Finally, several related considerations are addressed.

Patterns of industrialisation and deindustrialisation in Europe

2025-04-25T20:49:21+00:00

The aim of the article is to analyse the performance of the manufacturing sector in Europe in order to check whether there is a relationship between the level of development and the share of the industrial sector, and whether the manufacturing sector plays a key role in the economic growth and catching-up processes in European countries. The results of the study show that the evolution of the manufacturing sector is very different between countries, not only between countries at different levels of development but also between similar countries. The results also show the key role played by the Global Financial Crisis in explaining the fall in manufacturing output and employment and the deindustrialisation processes detected in certain countries.

Investigating the dynamics of the profit rate, the exchange rate, and terms of trade in Brazil

2025-04-25T21:03:38+00:00

This paper explores the intricate relationship between profit rates, exchange rates, and terms of trade in the Brazilian economy from 2000 to 2023. Building on Weisskopf’s (1979) decomposition of the profit rate, we demonstrate how exchange rates and terms of trade affect profit share, the potential output-capital ratio, and capacity utilization. Our results reveal a nonlinear, U-shaped relationship between exchange rates and profit rates. While currency devaluation can boost profit rates by increasing the profit share, it may negatively affect the potential output-capital ratio. Conversely, currency appreciation can raise the potential output-capital ratio but reduce the profit share. We show that terms of trade play a key role in shaping profit rates. Improvements in terms of trade can elevate the profit share, the potential output-capital ratio, and capacity utilization, leading to higher profitability. However, the impact of terms of trade on profit rates is complex, as they also influence exchange rates. Our findings underscore the importance of understanding the dynamic interplay between exchange rate, terms of trade, and the profit rate for economists and policymakers.

Sustainable development: Theory and some simple simulations

2025-04-25T21:25:14+00:00

This paper develops a unified framework to analyze the environmental, social, and economic dimensions of sustainable development within the context of a center-periphery international system. It introduces a three-gap model to address the challenges posed by the discrepancies among three key growth rates: the maximum growth rate compatible with external equilibrium, the minimum growth rate required for social inclusion, and the maximum growth rate consistent with environmental sustainability. Using updated theoretical and empirical insights, the paper applies the model to Latin American economies, highlighting the structural constraints and opportunities for achieving sustainable development in peripheral regions. By quantifying the interactions between technological capabilities, green investments, and social inclusion policies, the study offers policy recommendations to foster balanced and inclusive growth paths aligned with global sustainability commitments.

Strategies for economic development in Brazil: A Structuralist-Keynesian approach

2025-04-25T21:39:24+00:00

This paper aims to analyze the main reasons to the tendency toward stagnation of the Brazilian economy and to discuss a strategy of sustained development to overcome such tendency from a Keynesian-Structuralist approach, more specifically adopting a New-developmentalism green agenda. A sustained development strategy requires the reconstruction of the manufacturing industry not only to meet domestic demand but to conquer a larger and increasing share of world manufacturing exports. This goal has to be accomplished side by side with a sustainable environmental agenda, aimed at decarbonization and accelerating change in the environment.