Varieties of Developmentalism: A Critical Assessment of the PT Governments

• Date: 01 January 2020
• Author: Daniela Magalhães Prates,Luiz Fernando de Paula,Barbara Fritz
• Published date: 01 January 2020
• DOI: 10.1177/0094582X19894660
• Subject Matter: Articles

https://doi.org/10.1177/0094582X19894660

LATIN AMERICAN PERSPECTIVES, Issue 230, Vol. 47 No. 1, January 2020, 45–64

DOI: 10.1177/0094582X19894660

© 2019 Latin American Perspectives

45

Varieties of Developmentalism

A Critical Assessment of the PT Governments

by

Daniela Magalhães Prates, Barbara Fritz, and Luiz Fernando de Paula

To what extent did the PT governments follow developmentalist policies? A critical

assessment reveals that they combined two varieties of developmentalism in different ways

over time, with a surprisingly high frequency of policy changes, and that orthodox policies

played a prominent role in part of this time span.

Até que ponto os governos do PT seguiram políticas desenvolvimentistas? Uma

avaliação crítica revela que eles combinaram duas variedades de desenvolvimentismo

de maneiras diferentes ao longo do tempo, com uma frequência surpreendentemente

alta de mudanças de políticas, e que as políticas ortodoxas tiveram um papel de destaque

em parte desse período.

Keywords: Development, Economic policy, Brazilian economy, Developmentalism,

State

Brazil received considerable attention in the 2000s for combining growth

with equity, but its deep crisis in recent years has raised the question whether

both this success and its implosion were the result of a deliberate strategy or of

changes in the international context (mainly the boom-and-bust of commodi-

ties prices and capital flows) or domestic policy failures. This debate involves

supporters and opponents of the strategy adopted by successive Brazilian gov-

ernments led by the Partido dos Trabalhadores (Workers’ Party—PT) over

more than a decade, which many have labeled (though with different prefixes)

“developmentalist” (Ban, 2012; Bielschowsky, 2015) or (by analogy with “vari-

eties of capitalism”) “varieties of neoliberalism” (Saad-Filho in this issue).1

Following Fonseca (2014), the concept of developmentalism is ambiguous by

definition, nurtured both by theory and by experiences with economic policy.

Indeed, a common denominator for academics and the Brazilian governments

of this period (Ministério de Planejamento, 2003) was the aim of combining

sustained economic growth with the restructuring of production and income

distribution by giving the state an active role.

Daniela Magalhães Prates is an associate professor of economics at the University of Campinas

and a researcher with Brazil’s National Council for Scientific Development. Barbara Fritz is a

professor of economics at the Institute for Latin American Studies of the Freie Universität Berlin.

Luiz Fernando de Paula is a professor of economics at the Federal University of Rio de Janeiro, a

National Council for Scientific Development and Foundation for Research Support of the State of

Rio de Janeiro researcher.

894660LAPXXX10.1177/0094582X19894660Latin American PerspectivesPrates, Fritz, and Paula / Varieties Of Developmentalism

research-article2019

46 LATIN AMERICAN PERSPECTIVES

We ask whether and to what extent the PT governments (2003 to mid-2016)

adopted a developmentalist approach and, if so, what kind. To address our

research question, we offer three main hypotheses: (1) that there is a set of

conceptual approaches that can be labeled “developmentalist”; (2) that the

policies developed during this period represented different kinds of develop-

mentalism and even encompassed elements that we classify as “orthodox”;

and (3) that the significant changes of the policy mix over time were condi-

tioned both by the international context and by domestic factors. With this we

address a lacuna in the literature on the Brazilian case by attempting to shed

light on the policies applied and to bring out the differences between the PT

governments and the starkly orthodox government of President Michel

Temer, who took office with the impeachment of President Dilma Rousseff in

August 2016.

The following section presents the different varieties of developmentalism.

The next presents stylized facts of the external context and summarizes the

macroeconomic features of the Brazilian economy in the period under review.

The next lists the economic and social policies applied from 2003 to mid-2016,

and the next proposes a periodization and typology of PT government policies

in terms of the distinction between different developmentalist and other

approaches. The final section offers conclusions.

VARIETIES OF DEVELOPMENTALISM

“Developmentalism” involves two intertwined perspectives, that of a phe-

nomenon of the material world (economic practices) and that of a phenomenon

of the world of ideas (concepts or views of the world). The former is also

expressed as political discourse, while the latter seeks to form a school of

thought (Fonseca, 2014: 30). Developmentalism emerged from the develop-

ment studies of the 1950s and the Latin American structuralist approach, which

sought to understand the specificities of underdevelopment and how to over-

come it. Classic developmentalism departed from the idea that the typical divi-

sion of labor between developed and developing economies created a structural

balance-of-payments constraint and impaired domestic growth. As a phenom-

enon of the material world, it translated into national-developmentalist strate-

gies for promoting industrial development on the assumption that it was the

most efficient way of achieving an increase in productivity and in national

income. It used the “center-periphery” metaphor to translate the productive

and technological asymmetries of the international order and saw industriali-

zation as the only way for the peripheral economies to gain access to some of

the technical progress of the developed economies and gradually raise living

standards (Ocampo, 2001; Prebisch, 1950).

The current debate has been intertwined with policy discourse and policy

making, especially in the many Latin American countries where until recently

leftist parties dominated governments. Updated concepts of developmental-

ism attracted attention in semimature economies of the continent such as those

of Argentina and Brazil,2 which featured more diversified structures of produc-

tion and ran the risk of premature deindustrialization, because of profound