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Between the 1960s and the 1970s, Brazil and South Korea adopted similar strategies
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of development under authoritarian rule: an import substitution industrialisation
(ISI) programme later replaced by export strategies (ES), namely, export promotion
(EP) in Brazil and export-led growth (EG) in Korea. However, whereas Korea was
successful, Brazil began the 1980s facing socio-economic crisis because of imbalances
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in external accounts. Through the analysis of institutions, organisations, and eco-
nomic indicators, I conclude that the social-political structure (defined as the institu-
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tions and organisations within the economic, political, and social levels) of each
nation shaped differently the opportunities given by changes in the organisation of
the domestic economy and international contexts between 1945 and 1985. The social-
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political institutions, which last longer than organisations, come mainly from
Portuguese (in the case of Brazil) and Japanese (in the case of South Korea) colonisa-
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Introduction
This article aims to explain why after 1980 Brazil and South Korea followed
different patterns in economic and social development despite having adopted
a similar development strategy between 1945 and 1985 a process of import
substitution industrialisation (ISI) followed by export strategies (ES). In both
cases, the shift from ISI to ES was carried on under similar conditions at both
domestic and international levels. Being governed under either semi-democratic
or authoritarian regimes, both Brazil and South Korea are located in regions
(Latin America and East Asia) that were strategic for the United States to keep
Journal of International Relations and Development, 2013, (134) www.palgrave-journals.com/jird/
r 2013 Macmillan Publishers Ltd. 1408-6980/13
Journal of International Relations and Development
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the balance of power with the Soviet Union during the Cold War (19451991).
By the mid-1980s, Brazil and South Korea were both on the route towards
democratisation, characterised by regular elections, the expansion of civil rights,
and an increase in civil society activism (Ahn 1992; Carvalho 2001). However,
whereas Brazilian economy and society faced stagnation, a debt crisis, and
hyperinflation until mid-1990s, Koreans experienced a rise in their incomes and
standards of living that continued until 1997, when the Asian financial crisis hit.
In the 20 years after 1985, the Brazilian gross domestic product (GDP) per
capita increased only 18 per cent, whereas the South Korean GDP increased 201
per cent during the same period (World Bank 2008). Only in 2007 did Brazil reach
a high level of human development (HD), when its Human Development Index
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(HDI) score surpassed 0.7 in a scale that ranges from 0 to 1 (ibid.). However, the
country was still only 70th among the more than 180 countries ranked by the
HDI. South Korea had reached high HD in 1986 and in 2007 occupied the 26th
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position, reaching 0.921 points (ibid.), placing the country among the nations with
very high HD. In spite of having had a more authoritarian tradition than Brazil,
and thus having allowed less political participation throughout its history, Korea
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is now a less unequal society. According to data compiled by the World Bank
(2008), in 1998, just after the Asian financial crisis, South Koreas Gini Index,
which measures inequality on a scale from 0 (total equality) to 1 (highest con-
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centration of wealth), was 0.31 almost half of Brazils index of 0.59.
The main hypothesis is that the social-political institutions of each country
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hereby defined as the set of organisational patterns within the state, society, and
political system shaped differently the opportunities of development Brazil
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and South Korea had after World War II (WWII, 19391945). With organis-
ations, institutions compose the socio-political structure. In social sciences,
institutions broadly mean social mechanisms (e.g., clientelism), whereas organi-
sations are formal establishments (for example, the state). The social-political
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structure in both cases was mainly inherited from their respective colonial eras.
Brazil was formed as a Portuguese colony from the 16th century until its
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change. Critical junctures, however, are not systemic (Capoccia and Kelemen
2007: 343); they can, in the same timeframe, take place within one country but
not another. Therefore, junctures, as facts of historical significance (Pierson
2004) that unfold at the international level, can end up as critical junctures for
one country only.
The article is organised as follows. First, I explain the structure of the com-
parison between Brazil and South Korea, defining concepts and units of analysis.
Afterwards, I discuss alternative explanations to the divergence of outcomes
between both the countries. These explanations are related to geography, geo-
politics, the micro-dynamics of economic development, and politics in the period
of the development of ISI and the later move towards ES (19451985). The pitfalls
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of these explanations lay the ground for the argument that focuses on the social-
political structure ultimately inherited from colonial periods, notwithstanding the
fact that Brazil achieved political sovereignty much earlier than Korea and did not
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constitute a unique civilisation before colonisation.
question would be better addressed if the main unit of analysis was Brazils and
South Koreas economic arenas. However, partially echoing the dependency
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junctures. That said, I do not dismiss the reciprocal interaction between the
economic and the socio-political levels. Socio-political institutions, however,
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two countries in a given period of time from the colonial period to the 1980s)
and diachronic (comparison in a given aspect development in 1945 and 1985).
To facilitate the analysis, I assume that the economic arena is embedded in
the socio-political one, as argued by Polanyi (1944/2001), Granovetter (1985),
and Fligstein (2001). Therefore, modernisation that results from transitions
towards an industrial economy and society is constrained by socio-political
institutions. This argument implies that, unlike what advocates of modernisa-
tion theory predict (Rostow 1960/1990), changes in the economic arena do not
necessarily lead to the same process in politics and society. Old institutions
might be hidden by new organisations, constituting invisible legacies. On the
basis of the aforementioned difference between institutions and organisations,
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the model of analysis allows one to identify the persistence of old institutional
patterns after critical junctures. First, institutions are separated from organi-
sations. Once they are detached, I consider both in three levels: political,
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economic, and social. Therefore, the analysis is concluded with the comparison
between institutions and organisations in different periods.
Before proceeding to the analysis and the evaluation of other arguments that
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explain the case, it is necessary to build a caveat to understand state formation
and stateness in Brazil and South Korea. I hereby define stateness as the states
capacity of imposing its goals across social, political and economic spheres. As
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Evans (1995: 56) argues, in modern times, yas political survival and internal
peace are more often defined in economic terms, states have become respon-
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the social level can be equated to civil society for analytical purposes.
Civil society reflects state structures and capacity. Hereby civil society is
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markets, capital demands a particularly productive and quiescent labour
force, but in exchange, labour demands that it be protected from the greater
risk of recession and dislocation that an outward-oriented economy entails.
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However, the outcome of such a demand from labour in an economy that
adopts an ES, through either EP in Brazil or export-led growth (EG) in South
Korea in the 1970s, does not necessarily takes the shape of a classical welfare
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state (WS). A traditional WS is built through class compromise and, therefore,
democratic participation. Socio-political institutions inherited from historical
legacies, such as authoritarianism, clientelism, and patrimonialism in pre-capitalist
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and/or colonial times, may persist in time and limit the social arrangements
possible in a modern economy. For instance, authoritarianism (an institution)
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that comes from a historical legacy can be translated, under economic modernis-
ation, into state control of the main segments of civil society through the military
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Alternative explanations
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capital and counted on extensive sources of foreign aid. Finally, in politics,
authoritarian rulers in Brazil had to compromise with regional leaders and more
social actors than in South Korea, given Brazilian federal organisation and the
size of its territory (about 85.5 times larger than the South Korean one, with
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8.5 million square kilometres vs 99,300 square kilometres) and population (South
Korea had 22 million inhabitants in the early 1950s, against about 50 million in
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Brazil; in 1985, the numbers were 40 million and 130 million, respectively).
To begin with, geography per se does not restrict development. There are
high-income countries of all sizes and population densities. According to Gallup
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et al. (1999: 204), who conducted a quantitative study on the impact of physical
geography on development, both geography and policy matter. Geography is
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not necessarily destiny, but more than good policy is needed to foster economic
growth. Tropical regions, on the one hand, experience less growth as diseases
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has no correlation with growth (ibid. ). Brazil, unlike South Korea, is a tropical
country. That said, its most industrialised region, the neighbourhoods of the
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market faster before moving towards an ES. However, high population density is
not positively correlated with high levels of growth (Gallup et al. 1999: 180).
Another possible source of explanation for the divergence between Brazils
and South Koreas trajectories lies on the geopolitical configuration of the
world during the Cold War. Although the Korean War and the creation of
North Korea led to a higher degree of militarisation in South Korea than
did the fear of communist domination in Brazil, both the countries had
inherited authoritarian legacies from colonial times. Those trends cannot be
explained only because of international factors and how those factors were
internalised. Furthermore, whereas Brazil sought to be a great power under
military rule (19641985), South Korea and all capitalist East Asia constantly
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faced a closer threat: communism in North Korea, China, and the Soviet Union.
However, as Evans (1987) argues, all Latin American countries, especially
those in Central America and in the Caribbean, mattered in the balance of
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power between United States and Soviet Union during the Cold War. The
National Security Doctrine upon which the military in Brazil justified their
authoritarian rule consisted of increasing state intervention in order to
Furthermore, no one disputes the fact that East Asian countries such Korea
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in comparison with Latin American ones including Brazil received more
US aid in order to contain Communism in a historically problematic region,
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with disputes among three great powers (China, Japan, and Russia) plus the
United States. Although Evans (1987: 210) mentions that most of the aid went
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external resources financed nearly 70 per cent of all imports and 74 of the total
investment, says Kohli (ibid.). Nonetheless, US aid alone does not explain
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South Koreas success, as other countries receiving similar help did not reach
comparable levels of development, Pakistan perhaps being the best counter-
example (Khilji and Zampelli 1991).
The micro-dynamics of economic development are often considered a
relevant difference between the East Asian and Latin American experience with
ISI and ES. Reliance on foreign debt to promote growth proved too risky as
Latin America, including Brazil, faced the 1980s as the lost decade. In fact,
for Bresser-Pereira (1984: 173), foreign debt was the major limitation for
Brazilian development in the end of the 1970s, when the EP phase was already
on course. Nonetheless, South Korea had initially a higher proportion of
external debt in relation to its GNP, as Figure 1 shows. However, unlike in
Brazil, borrowing was far more regulated and centralised in the government
Journal of International Relations and Development
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Figure 1 External Debt (percentage of GNP) in Brazil and South Korea.
Sources: World Bank (2008); Amsden (1989: 95). NB: World Bank data is labelled as gross national
income (GNI), but according to a methodological note (http://data.worldbank.org/about/faq/
data-availability) the label is only a matter of terminology, being, thus, equated to GNP.
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Figure 2 Balance of Payments (2007 USD million) in Brazil and South Korea.
Source: International Monetary Fund (2008).
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(Kohli 2004: 106). The balance of payments (BP) in Brazil and Korea
(Figure 2) between 1976 and 19851 reflects the sensibility of both the countries
in the context of the economic turmoil provoked by the oil crises of 1973 and
1979 and the lack of liquidity in the international markets in their aftermath,
which led to the debt crisis in 1982. South Korea was as sensitive as Brazil to
international market variations, but was not as vulnerable because of the lack
of deficits and significant disequilibria in its BP in the beginning of the 1980s.
Considering the data above, one can infer that, at the end of the 1970s, Korea
was suffering less than Brazil from international economic turmoil. Further-
more, South Korea was able to keep high levels of productivity under national
companies. This ability, according to Amsden (1989: 1078), was essential in
Vincius Rodrigues Vieira
Invisible legacies
9
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Figure 3 GDP per capita (USD current values) in Brazil and South Korea.
Source: World Bank (2008).
recovering economic growth in that period. These patterns become clearer as the
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evolution of the GDP per capita of both countries is analysed (Figure 3). Until
1980, Brazil performed slightly better than South Korea in GDP per capita
growth. In 1981, however, a year before the debt crisis, South Korea started to
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increase its GDP per capita faster than Brazil in spite of the lack of liquidity in
the international markets. This means that South Korea managed to promote
economic growth even in a period of deep turbulence in international markets,
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while the Brazilian strategy collapsed, resulting in lower levels of development.
Dependence on foreign capital and the vulnerability of national economies
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found at the socio-political level and its relationship with economic actors.
First, vis-a-vis international capital, the Brazilian state did not have as much
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strength as the South Korean state: the former remained fragmented, unlike
the latter, which promoted effective centralisation and neutralised both con-
trary and concurrent interests in terms of national industrialisation goals. In
Evanss (1995: 12) definition, the Brazilian state is an intermediate case of
embedded autonomy, which can be defined as ythe combination of corporate
coherence [inside the state] and connectedness [links with society]. Insofar as
the Brazilian state lacks cohesiveness, it might be classified as a fragmented
multi-class state, according to Kohli (2004).
This does not mean, however, that public and private interests were not in
symbiotic relationship in Korea, which, according to Evans (1995: 12), is a
legitimate example of embedded autonomy or, as Kohli (2004) defines, a
cohesive-capitalist state. Some firms were chosen by the Korean government to
Journal of International Relations and Development
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perform a major role in the development process. Such choices were made
according to political connections with elites. Nonetheless, it was done through
a top-down approach, strictly controlled by the state, which had a tradition of
cohesiveness even before independence from Japanese rule. The fact that
business was highly concentrated facilitated government control and colla-
boration (ibid.: 96) for an ES. The government established top-down organisa-
tions to control business and labour. Meanwhile, the complexity of dependent
development strategy led the Brazilian state to have three different and con-
tradictory roles, simultaneously. It was perceived as entreguista (that is, likely
to satisfy only international interests), nationalist, and state for itself (Evans
1979: 214).
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However, political accounts that focus only on the authoritarian period under
which ISI moved towards ES lack a historical background, leading scholars to
miss what might be the actual sources of divergent trajectories. Although it is
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true that Brazilian military could not have governed the country without civilian
partners, thus generating a less cohesive state, fragmentation of power does not
necessarily imply the absence of a cohesive national project, as the American
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experience in uniting diffused socio-political forces in logrolled coalitions
suggests (Snyder 1991). The post-WWII political patterns of Brazil and South
Korea, thus, cannot be explained only through the social-political organisation
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at that time and the changes implied by economic development. One needs to
take a step back if one wants to find the genesis of institutions and, therefore, of
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settlements in the northeastern coast of South America. As there was not any
unified political entity prior to the arrival of the Europeans, one may argue that
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colonial rule in Brazil built the country rather than modifying it, as it happened in
South Korea. Nevertheless, the existence of a central government does not
necessarily mean that there was just one authority able to enforce its power over a
given territory. For instance, in Brazil, the existence of a governor general for the
colony did not hinder landowners power. They worked on the behalf of the
Portuguese crown and acted as de facto rulers in the neighbourhoods where they
were settled. Therefore, such indirect rule led to an unclear boundary between the
private and the public arenas in Brazil, a process of bifurcation analogous to the
one that existed in more recent colonial experiences, such as those in Africa
(Mamdani 1996). According to Holanda (1936/2001), these are the roots of the
patrimonialism broadly, the use of the public arena for private purposes
that still pervades both state and society in Brazil.
Vincius Rodrigues Vieira
Invisible legacies
11
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In 1930, a revolution overthrew the so-called Old Republic, dominated by
landowners and oligarchs. Collier and Collier (1991) consider this a critical
juncture for Brazil.
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The new government continued the authoritarian tradition and promoted
industrialisation. This approach was likely to be successful in the aftermath of
the crisis of 1929, which ended the liberal order that had been in place at the
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international level since the 1870s. Urban workers secured rights on a
corporatist basis, in spite of the lack of either civil or political liberties (ibid.).
As Santos (1979) points out, a regulated citizenship was set up. This means
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that access to social rights was based on state concessions according to the
workers occupation. According to Evans (1979), the ISI process was based
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In Korea (not then divided in two countries), says Kohli (1994: 12725),
Japanese rule between 1905 and 1945 reformed a disintegrating state through
both authoritarian and non-repressive strategies. Among these strategies was
the creation of bureaucratic structures that prevented corruption and improved
the education system. Through these measures, Japanese colonial rule built
a cohesive state apparatus, reducing the influence of previous patrimonial
institutions. Amsden (1989: 35), however, has a pessimistic vision of this
period. As she says,
The end result of Japanese colonialism in Korea was a society that was
unable to support itself and totally at odds. Peasant opposed landlord, and
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those who resisted Japanese colonialism opposed those who collaborated.
Under these conditions, the machinery of modern government that Japan
had bequest was a useless inheritance.
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Nonetheless, there is enough evidence to conclude that Japanese rule left
legacies that shaped both state and society in Korea after WWII, insofar
as older socio-political institutions significantly changed after colonisation.
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The Yi Dynasty that ruled Korea for more than six centuries (Ahn 1992: 8),
promoted slavery until early 19th century. By the beginning of colonisation,
70 per cent of all family farmers were tenants. The landowners had a strong
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influence, as was happening in Brazil. Owing to Japanese colonisation they lost
political power, but gained property rights and were able to draw profits from
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land (Kohli 2004: 43). As carrier bureaucrats took over official functions, the
direct control of landed classes on state weakened (ibid.: 1277). Those
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bureaucrats acted in the form of police (Amsden 1989: 34). Thus, a crucial
point was not the exclusion of landowners from political process per se, but
how they were incorporated into new socio-political institutions. The general
point is that Korean landowning groups prospered under colonial government,
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property rights and the dispossession of the peasantry created acute distress
(Amsden 1989: 34), leading to an overall decline in Korean welfare.
A working class emerged during the colonial rule because of the develop-
ment of industrial activities. Nonetheless, it was not until the 1930s that
industrialisation actually occurred. The decision to launch industrial invest-
ments in the colony was part of the Japanese expansionist strategy in order to
overcome the harmful consequences of the economic depression (Kohli 2004:
41). Such industrialisation, argues Amsden (1989: 34), was also part of Japans
strategy for WWII and was based upon zaibatsu (large economic clusters with
deep ties to the state) capital. Unlike in Brazil, however, the working class
in Korea was not incorporated into the political arena with social rights.
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Nonetheless, as Kohli (2004) points out, there are few studies about labour in
Korea, especially in the period prior to WWII. Interestingly, around 1930 there
was not so much difference between Brazil and Korea with regard to human
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capital. Data compiled by Amsden (1989: 217) reveal that in 1928 4 per cent of
the Korean population (including in the north) was enrolled in school. In
Brazil, the proportion reached 5.3 per cent in 1936 (Instituto Brasileiro de
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Geografia e Estatstica 2001). This suggests that the gap between Brazilian and
Korean educational systems increased mainly after WWII, when both had
similar socio-political organisations yet different institutions.
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In Table 1, the comparison of social-political and economic structures
between the pre-colonial and the post-colonial times leads to the conclusion that,
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in Brazil and Korea, colonial rule created new institutions and organisa-
tions. Therefore, colonisation represents a critical juncture in the analysed cases.
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To summarise, in spite of having built more cohesive states in the first half of
the 20th century, Brazil and South Korea remained with significant authori-
tarian patterns within civil society and the state. These patterns would influence
the post-WWII period in both the countries, notwithstanding growing industria-
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Journal of International Relations and Development
analysis juncture critical one?
Brazil
Institutions Political Fragmented Portuguese Clientelism (fragmented) Yes (both institutions
Colonisation (16th and organisations were
Century1822) re-created)
Economic Subsistence agriculture Agrarian exporting
Social Diverse indigenous Landowners vs. slaves (until
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groups emancipation in 1888) and peasantry
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federal and highly decentralised
state (in the Republic, yet the
Empire had faced demands for
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decentralisation)
Economic Farms
Social Weak but independent work unions
(starting in early 20th Century)
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Korea
Institutions Political Decentralisation, Japanese colonial Centralisation Yes (both institutions
bifurcated state rule (19051945) and organisations were
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re-created)
Economic Agrarian Agrarian and Industrial
Social Slavery and serfdom Landowners vs. disposed peasantry,
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(feudalism) industrial workers
Organisations Political Corrupted, decentralised Centralised bureaucracy, strongly
bureaucracy in the Yi professional, cohesive-capitalist state
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dynasty
Economic Farms Farms and industries
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Social Lack of organisation in civil Disorganised civil society
society
Vincius Rodrigues Vieira
Invisible legacies
15
capital, and international investors would be built (Evans 1979). The state
continued to foster industrialisation mainly based on consumption goods,
shifting from a strategy mainly based on national capital, as defended by
Vargas during his democratic term as president (19511954), towards an
increasing participation of foreign capital, as happened during Juscelino
Kubitschecks presidency (19561961).
Therefore, Brazil started to take advantage of the new international division
of labour that emerged after WWII. This might be considered a landmark in
the process of industrialisation with strong participation of the international
capital. Meanwhile, urban workers became increasingly organised, although
they kept ties with the state. The agrarian structure remained intact as in
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previous periods, with large properties and peasants under oligarch rule.
However, the democratic regime, despite the disenfranchisement of the
illiterate, opened space for an emerging rural activism, which even included
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demands for land reform (Collier and Collier 1991: 5658).
Korea also embraced ISI, though through much more complex trans-
formations. After the end of WWII, in 1945, the Soviet Union occupied the
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Korean peninsula north of the 38th parallel, whereas American troops
remained in the south. However, as both sides attempted to establish regimes
friendly to their interests, difficulties emerged in attempts to unify the
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countryy, explains Ahn (1992: 12). The main attempt of unification was the
short-lived Korean Peoples Republic (KPR), which lasted from August to
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American regime, they dismissed the popular KPR and sought to work instead
with Korean middle classes (Kohli 2004: 64). As Ahn (1992: 15) explains,
based on Cummings (1984), the American occupation ysought to bolster the
conservative rightists of the Korean Democratic Party (KDP), most of whom
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and communism. There was deliberate land redistribution during the Korean
War, as well as cases in which smallholders bought land from Japanese owners
(ibid.: 72). Japanese technologies were maintained. The compensation paid
to indigenous landowners was invested in industry and education (ibid.: 73).
With regard to the structure of the state in South Korea, Kay (2006: 29)
mentions that:
Owing to the disappearances of the landlords the state filled the political
vacuum and directly controlled the mass of the peasantry. This was achieved
by dispatching a large number of government officials into the countryside,
by appointing village leaders, through political indoctrination and direct
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mobilizations of the rural population.
Nonetheless, one may argue that such a political vacuum would not have
been occupied by the state were it not for the legacy left by the Japanese in the
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bureaucratic structure. Thus, in the absence of strong landowners and partially
because of land redistribution, an internal market for industrial goods emerged
(Kay 2006). For Amsden, however, the land reform was pushed by the
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American occupational forces in reaction to violent peasant demands.
Although land-to-the-tiller in Korea never enriched the peasantry or
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overflowed state tax coffers, its long-run effects were major. Reform redirec-
ted idle capital away from land speculation to manufacturing and uprooted
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a class that had not proved itself progressive y It created a far more equi-
table income distribution. Finally, it cleared the field for strong centralised
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The 1950s had witnessed a decrease in the size of agricultural enterprises and
the death knell of the nobility, along with an increase in the size of industrial
enterprises and the tentative groping toward a symbiotic relationship
between the state and the progenitors of large diversified business groups.
During the same decade the country pursued an ISI strategy based upon such
a social-political structure and the Japanese colonial legacy. According to Evans
(1987: 213), however, the South Korean industrial bourgeoisie was weakened
after WWII, because most heavy industry was located in North Korea. More-
over, as Kohli (2004) says, the Korean War destroyed two-thirds of industry
capacity. However, even after the Korean War and US occupation that
followed, Japan continued to be a reference society for South Korean elites
(Kohli 1994: 1286), thus offering a model for South Koreas ISI experience.
Vincius Rodrigues Vieira
Invisible legacies
17
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Figure 4 Aid (per cent of gross capital formation) in Brazil and South Korea.
Source: World Bank (2008).
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Critical to note here is not only the structure of the economy that was
inherited by South Korea [from the Japanese], but also the psychological
legacy: whereas most developing countries in the world emerged from WWII
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with a distrust in open economies y many South Korean elites came to
associate, rather early, an export orientation with a high-growth economy.
(ibid.: 1282)
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Along with land reform, foreign aid, particularly from the United States, had
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ment. Foreign aid would remain an important source of capital formation until
mid-1960s in South Korea, in contrast to the Brazilian experience (Figure 4).
Moreover, South Korea imported large quantities of free or cheap food from the
United States (Kay 2006: 29). These facts, however, are part of what I called
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the South Korean government at a given point in time (the late 1950s and early
1960s), these junctures do not account for long-term trends that put South
Korea on a more stable route to development than the one Brazil had been
following since colonisation.
Regarding labour organisation, Brazil and South Korea established a tight
control over unions. However, because of stronger political centralisation, South
Korea was more successful in achieving this task. Whereas in Brazil the legacies of
corporatist patterns launched by the Estado Novo remained during the democratic
period between 1945 and 1964, Korea outlawed a leftist labour movement
(Chonpyong) in 1947. After the Korean War, the government incorporated the
Federation of Korean Trade Unions (FKTU) into the Liberal Party, which was in
power (Koo 2006). In the Brazilian system, there was a detachment of the labour
Journal of International Relations and Development
2013
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movement from the state and the ruling party. As (Collier and Collier 1991:
5545) argue, y given the restricted links between the governing party and the
unions, the government did not have the political resources with which to defeat
the challenge of an increasingly assertive and radicalizing labour movement. That
said, labour was still relatively dependent on the state apparatus, as social rights,
including access to healthcare and social security, were segmented according to
professions.
Usually considered a critical juncture for both Brazil and South Korea, the
period from the 1930s to the 1950s did not have in those countries as much
impact on institutions as did the colonial period (Table 2). In Brazil economic
modernisation, and in South Korea the American intervention and the Korean
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War, significantly changed organisations. Nevertheless, this change did not
modify socio-political institutions that had been inherited from colonisation,
such as the centralised state in South Korea and the clientelistic relationship
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between state and civil society in Brazil. Therefore, the early stage of ISI in
Brazil and South Korea, between 1945 and early 1960s, was still pervaded by
invisible legacies of earlier periods.
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To summarise, one may argue that what differentiates South Korea from
Brazil in the period from 1945 and 1960s was the reorganisation of political
and social relations in the countryside. Indeed, it seems that Rhee managed to
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build in South Korea what Vargas was not able to in Brazil between 1930 and
1945: a strong and centralised state, controlling directly even the peasantry.
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salient role, suggesting that what triggered Koreas trajectory is found before
1945. Likewise, Brazils socio-political fragmentation after a dictatorial experi-
ence and persistent inchoateness is evidence of the role of the legacies of
colonialism in shaping ISIs socio-political framework.
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A
Brazil
Institutions Political Clientelism Incorporation period, after Clientelism/Corporatism No (new organisations,
(fragmented) the emergence of working (fragmented) particularly in economy
class and middle sectors in a with growing
A
context of commercial and industrialisation, within
industrial growth, old socio-political
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centralisation of the state institutions behind new
did not annihilate regional organisations, such as
patrons (19301945) the system of protection
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of urban labour)
Economic Agrarian Agrarian exporting/ ISI
exporting
Social Land owners vs. Elite (landowners and
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peasantry industrials), middle class
(civilian and military
servants) vs. labour
Invisible legacies
highly-decentralised state (federal), fragmented-
multi-class state
O
Economic Farms Cities and industries and
farms
Social Weak but independent Stronger but not so
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work unions (starting independent work unions,
in early 20th century) fragmented civil society
19
20
Table 2 Continued
Unit of Level of Prior to the Juncture After the Was the juncture a
2013
Journal of International Relations and Development
analysis analysis juncture juncture critical one?
South Korea
Institutions Political Centralisation Separation from the Centralisation No (new organisation
communist North (1948), with increasing
Korean War (19501953 industrialisation within
only) and land reform, old institutions,
A
American intervention particularly the
(19451953) centralised state
U
inherited from the
Japanese)
Economic Agrarian and Industrial ISI
TH
Social Landowners vs. disposed Small holders and urban
peasantry, industrial proletariat
workers
Organisations Political Centralised bureaucracy, Centralised bureaucracy,
O
strongly professional, strongly professional,
cohesive-capitalist state cohesive-capitalist state
R
Economic Farms and industries Small properties and
industries
C
O
PY
Vincius Rodrigues Vieira
Invisible legacies
21
Brazil kept the industrialisation pace started during the 1930s, shifting from an
authoritarian rule to a procedural democracy (Collier and Collier 1991).
Nonetheless, even under a formal democratic regime, the Brazilian social-
political arena remained unstable, with an increasing influence of the military
on political affairs a process analogous to the Korean one. In Brazil, the
necessity to advance the ISI process towards the production of capital goods
led to the rise of the bureaucratic-authoritarian (BA) state, a social-political
excluding system in which
ycentral actors in the dominant coalition include high-level technocrats
military and civilian, within and outside the state working in close
PY
association with foreign capital. This new elite eliminates electoral com-
petition and severely controls the political participation of the popular
sector. Public policy is centrally concerned with promoting advanced
industrialisation. (Collier 1979: 24)
O
Therefore, the BA is an answer both to the social tensions that had arisen
C
during the previous period and to the new phase of ISI, which requires
orthodox economic policies that harm the welfare of the popular sector. The
new ISI phase is also a step towards an ES, which can be either EG, with a
R
focus on growth through exports, or EP, in which the internal market matters
at least as much as the external. The BA in Brazil was inaugurated in 1964,
O
when a coup detat overthrew the president Joao Goulart, whose government
faced popular unrest and economic instability. Im (1987) proposes an
TH
adaptation of the BA approach for South Korea, despite the fact it was
originally elaborated to understand authoritarianism amid modernisation in
Latin American countries. Park Chung Hee reached the Korean presidency
after Rhees fall before student mobilisation. Before Hees rise, Chang Myon
U
was sworn into office, where he remained for less than a year. A coup led by a
coalition the Supreme Council for National Reconstruction (19611963)
A
PY
organisation is concerned, there are two important differences between Brazil
and South Korea. First, in the latter, peasantry had been incorporated into
modern economy through land reform. Second, unlike Brazil, South Korea
experienced a lower degree of procedural democracy prior to the BA. As
O
Cummings (1987: 70) argues, politics in South Korea:
did not stretch to include workers, peasants, or plural competition for
C
power. The political sequence of inclusion followed by exclusion, as the
easy phase ended and export-led development began, was absent. Labour
R
was excluded in the 1950s and remained excluded in the 1960s; nor did
the squeezed middle class of bureaucrats and small businessmen achieve
O
representation.
Therefore, in comparison with the Brazilian state, the Korean one was much
TH
when this strategy faced difficulties because of few natural resources, a small
domestic market, low capital endowments, and unsophisticated technology, the
export platform based on the new international division of labour was an
optimal strategic choice for South Korea (ibid.). In fact, South Korea seemed
to have a very strong incentive to pursue an outward-growth strategy in this
phase because of its small internal market (Kwon 1990: 40). Equal to the
number of inhabitants of a country, the potential internal market, however, is
not an incentive per se. Although Brazil had more than twice the number of
inhabitants in South Korea, it did not expand its internal market up to the
limit. Rather, exclusion from consumption contributed to the further
development of ISI amid an ES. Along with other economic policies, explains
Bulmer-Thomas (2003: 327), the concentration of income in the upper deciles,
Vincius Rodrigues Vieira
Invisible legacies
23
Figure 5 Manufactures exports (per cent of merchandise exports) in Brazil and South Korea.
PY
Source: World Bank (2008).
coupled with new credit facilities, provided the necessary conditions for rapid
O
growth of the consumer durable industries.
As Figure 5 shows, the highest rise of the participation of manufacturers in
Korean merchandise exports happened between 1962 and 1964. Nonetheless,
C
based on Figure 6, one may argue that the emphasis on EG strategy started
10 years later, in 1971, after the launch of the BA. It is possible to assume that,
until then, as South Koreas GDP did not depend so much on merchandise
R
export, the country was following only EP. According to Bulmer-Thomas
(2003), in the aftermath of the second phase of ISI strategy Brazil followed EP
O
in order to minimise the limitations of ISI. The same author points out that the
balance of payments was the Achilles heel of inward-looking development as
TH
the policies adopted to favour industry undermined the export sector and
shifted the composition of imports in the direction of complementary goods
(ibid.: 323). The EP strategy which was developed at a very slow pace, as a
comparison between Figures 5 and 6 reveals started after the military coup
U
in 1964.
The military coup in Brazil was followed by a 3-year stabilisation period
A
that enabled the so-called Brazilian miracle between 1967 and 1974, when the
GDP grew more than 10 per cent per year on average. As Bulmer-Thomas
argues, EP was already part of the core of economic policy in Brazil at
those times. Regarding the South Korean model, Kim says that it cannot
be classified as purely ES, which suggests similarities with Brazilian ISI
followed by EP. ISI, says Kim, always existed along with export sectors in a
complementary process. While the first stage, import substitution industria-
lisation (ISI), can be regarded as pure import substitution industrialisation, in
the Korean case, the subsequent ISI was aimed at raising infant industries,
which would become export industries in the future (Kim 2002: 3132). Some
authors, however, point out that South Korea took advantage of both cheap
labour and social-cultural factors inherently in its population in order to further
Journal of International Relations and Development
2013
24
PY
Figure 6 Merchandise trade (per cent of GDP) in Brazil and South Korea.
Source: World Bank (2008).
O
C
R
O
TH
Figure 7 Foreign direct investment, net inflows (per cent of GDP) in Brazil and South Korea.
Source: World Bank (2008).
the industrialisation process in the 1960s and the 1970s. Nonetheless, as Kwon
U
The changing pattern of Korean exports, especially in the 1970s and 1980s,
cannot be attributed so readily to the underlying advantage of Korea.
Instead, trade seems to reflect strategic change in comparative advantage
created by Korean firms through the help of government policies. In other
words, in Korea there was a rapid change in the structure of trade.
Therefore, as in Brazil, state action in Korea was essential to promote
changes in both economic and socio-political organisations. Furthermore, as
Evans (1987: 212) argues, while Latin American economies counted on strong
state intervention, most analysts would agree that the interests of private
capital predominate. Although East Asian NICs clearly cater to the interests of
capital, most analysts argue that the state plays a more dominant role.
According to the same author, the organisation of BAs in East Asia happened
Vincius Rodrigues Vieira
Invisible legacies
25
PY
Brazil and South Korea followed these regional patterns, as the proportional
amount of foreign direct investment inflows in the GDP of both countries
show. There is comparative data available only after 1976 (Figure 7). Indeed,
the participation of FDI in Korea never was as strong as it was in Brazil.2 Even
O
during the early ISI phase, the Brazilian economy received higher levels of
capital inflows. According to data compiled by Lewis (1969: 363), between
C
1953 and 1960, foreign capital was responsible for 21.2 per cent of whole gross
domestic fixed capital formation. Furthermore, as Haggard and Cheng (1987:
87) argue, South Korea was too small and politically risky to attract much
R
investment interest.
Despite the fact that Parks policies in South Korea during the 1970s
O
those who moved out of agriculture [to cities] found jobs not in industry, but in
the tertiary sector, usually in low-paid jobs. The exclusion of most of population
from the development process and disequilibria in the BP undermined economic
growth in the long term. The roots of exclusion, however, date back beyond both
ISI and ES phases: they are found in the colonial period.
PY
bargained. Kohli (2004: 217) says that military rule in Brazil had more internal
divisions than the one in South Korea, needing the support of regional
oligarchs, having few problems working with foreign capital, and denying the
O
deleterious consequences of inequality. These characteristics, says Kohli,
ylimited the Brazilian states capacities in two very important areas, namely,
its ability to tackle the repeated fiscal and balance-of-payment crises that have
plagued Brazil (ibid.).
C
Furthermore, the South Korean state managed to change both institutions
and organisations that structure the socio-political arena. Such a process
R
happened before the rise of the BA state, because of the state action in the land
reform and mostly because of the legacy of Japanese colonisation. The juncture
O
in 1930s Brazil, during which the agrarian elites lost power at the national
level, produced changes in the organisations. Nonetheless, the socio-political
TH
A point that cannot be denied about the South Korean case when compared
with the Brazilian developmental experience is the emphasis on education.
As mentioned earlier, such emphasis is a virtuous legacy from Japanese
colonialism. Were it not for that, South Korea would not have built human
capabilities that were crucial to the country to acquire competitive advantage
in the aftermath of the capitalist crisis of the 1970s. Characterised by the
liberalisation of the international markets as well as by an increasing role of
information and communication technologies (ICTs) and other high techno-
logical goods in the economy, the turmoil ultimately triggered the debt
crisis that would severely hurt Latin American economies in the 1980s,
among them Brazils. Even in the 1950s, Korea was performing far better than
PY
Brazil in education. According to Amsden (1989: 217), in 1954 17 per cent
of all Koreans were enrolled in school, almost twice the rate as in Brazil
(9 per cent). As mentioned before, these rates in the 1930s were, respectively,
O
4 per cent (including the portion of the territory that is now North Korea) and
5 per cent.
Another contrast between the Korean and Brazilian states can also be
C
attributed to colonial legacies, and is identified in their Weberianness Scale.
Such scale is calculated upon the degree of meritocratic recruitment and pre-
dictable career progression. After analysing data from 30 semi-industrialised
R
and five poor countries, Evans and Rauch (1999) found out that low levels
of income per capita are not a barrier to organise a competent bureaucracy.
O
Unit of Level of Prior to the juncture Juncture After the juncture Was the juncture a
2013
Journal of International Relations and Development
analysis analysis critical one?
Brazil
Institutions Political Clientelism/ Military coup Clientelism/Corporatism No (new
Corporatism (1964), and BA state (fragmented) organisation within
(fragmented) old institutions)
Social
A
Elite (landowners and Elite (landowners and industrials),
U
industrials), middle class middle class (civilian and military
(civilian and military servants) vs. labour (peasantry and
servants) vs. labour workers)
TH
(peasantry and workers)
O
fragmented-multi-class (bifurcation)
state
R
Economic Cities and industries and Cities and industries and slum-
farms formation in large urban areas
C
Social Strong but not so Weak and limited unions,
independent work fragmented civil society
unions, fragmented civil
O
society
PY
South Korea
Institutions Political Centralisation Supreme Council for Centralisation No (new
National organisation,
Reconstruction particularly in
(19611963), and BA economy with the
state (consolidated in embrace of EG,
1971, with Yushin) within old
institutions)
Economic ISI EP, with focus on EG (for some
authors, it was actually EP)
Social
A
Small holders and urban Small holders and urban
U
proletariat proletariat
Organisations Political Centralised BA
bureaucracy, strongly
TH
professional, cohesive-
capitalist state;
Economic Small properties and Small properties and industries
industries (state alliance with chaebols)
O
Social Weak and limited Weak and limited unions
unions
Invisible legacies
O
PY
29
Journal of International Relations and Development
2013
30
Conclusion
To summarise, historical junctures prior to the move towards ISI and later
from ISI to ES explain the configuration of organisations in Brazil and Korea
and their divergent trajectory of development during the Cold War. The roots
PY
of the cohesive-capitalist state in Korea lie in the colonial period, as the
fragmented multi-class state in Brazil owes much to the Portuguese invisible
institutional legacy. Owing mainly to Japanese colonial legacies, Korea had
O
a higher degree of state capacity than Brazil, and, thus, was less vulnerable to
the world-wide transformations. Therefore, rather than the so-called forces
of the market or organisational configuration of the BA period, older historical
divergent trajectories. C
socio-political institutions in Brazil and Korea are at the origin of their
The emphasis on colonial legacies does not detract from the role that later
R
junctures had in both cases. For instance, along with Japanese rule, US post-
WWII occupation in South Korea reshaped institutions and organisations in a
O
top-down approach. That said, the Japanese rule seems to have been more
important, insofar as it provided a psychological legacy that favoured EG and
TH
a certain degree of human-capability building. Brazil did not achieve the same
process. It is noteworthy that a context of tabula rasa (blank slate), like the
post-war in Korea, never happened in the Brazilian case. Such a context
provides opportunity for reshaping civil society and the state, as when the
U
not only organisations. Both Brazil and South Korea have passed through
salient junctures after the period of study of this article, although only another
research project can clearly answer the extent of those changes: are they route
corrections or a mere continuation of invisible legacies that lie behind
economic organisations?
Since the mid-2000s, Brazilian society has witnessed the inclusion of about
30 million people into consumption, in large part because of the increasing
number of new low-skilled positions, leading to a process of wealth redistribu-
tions (Neri 2008). Ironically, such a process took place in parallel to a boost in
Brazilian commodities exports, an economic process historically associated
with wealth concentration, backwardness and oligarchies in Latin America.
PY
Meanwhile, Brazil has been regarded as one of the new world powers in a post-
Western world and its democratic institutions seem to be working well, with a
coalition that counts with oligarchs yet is headed by the Workers Party (PT),
O
which emerged from the labour movement that challenged the dictatorship
in late 1970s. However, 10 years after first PT government started in 2003,
there has not been any significant reform in the structure of the Brazilian state
C
or the delivery of public services that could enhance the populations needs
beyond consumption. This casts doubts about the actual impact of economic
transformation in socio-political institutions, particularly clientelism and
R
patrimonialism.
Will South Koreas relative level of development decline with increasing
O
China may have over the countrys security, at least while the division with the
communist, Sino-backed North persists. The world seems to be witnessing an
important juncture since the beginning of the financial crisis of 2008, the worst
since the 1929 crash, after which both Brazil and South Korea launched the
U
in junctures such as the current one. The fact is that invisible legacies have a
long-lasting effect, pervading national trajectories of development even when
everything seems to be under an irreversible change. These legacies might be
invisible, but not irreversible.
Notes
1 There was no comparative data available between 1960 and 1975.
2 It must be noted that the best indicator of the impact of FDI in an economy is its participation
in the gross domestic fixed capital formation. Nonetheless, there is no data available about it for
Brazil between 1960 and 1990. In the period 1976 and 1985, the average of gross domestic fixed
capital formation in Brazil and South Korea was, respectively, 21 per cent and 29 per cent of the
GDP (World Bank 2008).
Journal of International Relations and Development
2013
32
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Nuffield College, University of Oxford. He holds an M.A. in Latin American
studies from the University of California, Berkeley, and a B.A. in public
affairs, with a major in journalism, from the University of Sao Paulo, Brazil.
O
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