An analysis of the Brazilian motor vehicle industry : the political economy of its development and its significance to the Brazilian economy

The study focuses on the Brazilian motor vehicle industry as an example of the application of an import-substitution-industrialization strategy in a less developed country. In 1956, the Brazilian government instituted a comprehensive plan to create a fully integrated domestic motor vehicle industry. This study describes the policies used by the government in implementing its strategy and analyzes the effectiveness of this strategy in light of its objectives.

Much of the information and data presented were collected in Brazil in the form of published works and reports from sources such as the motor vehicle producers association, the motor vehicle parts producers association, government agencies, and academic studies. Figure from the Brazilian Input-Output table were used to calculate the linkage effects of the motor vehicle industry. Domestic resource cost and foreign exchange savings were also calculated from available data.

The analysis of the data indicated that the motor vehicle industry was an appropriate choice as a target industry for import substitution, and that the objectives of this type of strategy were achieved to a significant degree.