“Reconsideration of Import Substitution”, by Henry J. Breton, Journal of Economic Literature June 1998, pp. 903-936.

The following text contains two sections of the article above by Henry J. Breton. Your job is to agree or disagree with these statements. Read the definition and mark it right or wrong.

Section 3.2. Key Role of Capital Formation

These ideas put primary emphasis on capital formation as the source of growth. The most obvious difference between firms in rich countries and those in poor ones was the extent to which physical capital was available to work with the labor. There are virtually no data on capital/labor ratios for the early 195 Q's, but there is little doubt that this ratio was vastly higher in the North than in the South in virtually all sectors, except for foreign firms engaged in mining of one kind or another. Thus another policy objective eras to accelerate the rate of investment. This view was supported by a now-famous Arthur Lewis statement: "The central problem in the theory of economic growth is to understand the process by which a community is converted from being a 5 percent saver to a 12 percent saver"(Lewis 1955, pp. 325-26). Tae nearest thing available to a formal theory of growth was that of Roy F. Harrod (1939. 1949), in which the only specified source of growth was capital formation. Harrod specified a simple relationship between increased output and increased capital--the incremental capital/output ratio (ICOR). This ratio was assumed to be constant due to technological factors. There were numerous estimates of the ICOR, and most plans made specific assumptions about its value for sectors and for the economy as a whole. Such estimates were widely used to determine the amount of new capital required to achieve a given growth target. Most observers considered domestic saving the primary constraint, and the earliest arguments for foreign aid rested on the assumption that the savings of the poor countries had to be supplemented by foreign savings if acceptable growth rates were to be achieved.

The allocation of capital within the boundaries laid down with respect to structural change was an important issue. In some instances, the ICOR estimates were used as a criterion; that is; invest where the ICORs are smallest. There were efforts to identify specific objectives to be served by the new investment: for example to raise the saving rate, increase exports, maximize na employment effect, meet certain regional objectives, etc. Evidently this way of thinking revealed further doubts about an effective market answer.

The capital goods sector :vas small or nonexistent in the newly independent countries, and most capital goods had to be imported. An obvious way to encourage investment was to maintain an exchange rate that kept capital's domestic price low. This could be most easily done by maintaining an overvalued exchange rate (or, less frequently, multiple exchange rates). Overvalued exchange rates (relative to a free trade situation) appeared as a means to encourage investment. This produced balance of payment pressures, and to counter these

varieties of tariffs. import licenses, and exchange controls were put in place. Protection in many forms was afforded currently imported consumer durables (and now and then simple capital goods) behind which domestic production took place. Consumer goods (especially durables), rather than capital goods, were protected on the grounds that their costs of production in the developing country would be relatively less than those of capital goods, because production of the latter goods was assumed to be more capital intensive and to employ more complex technology. Where Mahalanobis' view strongly prevailed--India. Brazil, and possibly other large countries--domestic production of capital goods .:as encouraged by keeping out imports and by direct subsidies. Even in such countries. however, attention was given mainly to protecting the domestic market from importation of consumer durables.

There was a consensus among these theoreticians that the saving in the south had to be increased.

Item 3 - The poor savings rate in the south lead to the first ideas of foreign aid.

Em relação à política econômica implementada desde 1994, pode-se afirmar que:

Item 3 - provocou uma queda generalizada nos mark-ups praticados nos diferentes setores da indústria de transformação;

Podemos afirmar que:

Item 4 - Para qualquer tamanho de amostra, a distribuição amostral de proporções de uma amostra de sucessos é mais dispersa quando a proporção populacional é igual ½ e é menos dispersa quando a proporção populacional é igual a zero ou a um.

Considere uma loteria com 3 possíveis resultados: o recebimento de $100 com probabilidade 0,10; o recebimento de $25 com probabilidade 0,60; e o recebimento de $0 com probabilidade 0,30.

Item 0 - Se a função-utilidade de um indivíduo for dada por !$ U(x)=\sqrt x !$, onde x = valor recebido, a utilidade esperada desta loteria para este indivíduo será 5.

No que se refere à economia brasileira durante a Segunda Guerra Mundial, pode-se afirmar que as condições criadas por este conflito:

Item 3 - levaram ao surgimento de saldos deficitários na balança comercial;

Com relação as definições de Coeficiente de Correlação e de Esperança Matemática, pode-se afirmar que :

Item 2 - Se o coeficiente de correlação entre as variáveis X e Y é igual a zero, então E(XY)=E(X)E(Y). Assim, pode-se concluir que X e Y são variáveis aleatórias independentes.

Podemos afirmar que:

Item 0 - Pelo Teorema do Limite Central podemos afirmar que se a variável aleatória X tem uma distribuição qualquer com média !$ \mu !$ e variância !$ \sigma^2 !$, então a distribuição de !$ \overline{X} !$ (média da amostra) aproxima-se da distribuição normal com os mesmos parâmetros média !$ \mu !$ e variância !$ \sigma^2 !$, quando o tamanho da amostra aumenta.

Foram encontrados os seguintes resultados para estimar uma regressão linear com duas variáveis explicativas para uma amostra de tamanho 10.

!$ R^2=81,2% !$; !$ R^2 !$ ajustado =76,1%; Valor calcuado da estatística F=15,1

Podemos afirmar que:

Item 3 - O valor estimado para Y quando X₁ = 15 e X₂ = 80 é 220.

A implementação do II PND (1974/1978) provocou importantes efeitos na economia brasileira. Dentre eles destacam-se:

Item 0 - as mudanças na estrutura de oferta, notadamente através da ampliação da produção de insumos básicos (papel e celulose, fertilizantes, petroquímica, etc.);

A evolução da política cambial brasileira, anterior à crise de 1929, permite as seguintes observações:

Item 4 - na primeira metade dos anos vinte foi adotada a política de minidesvalorizações cambiais.