The Economies of Argentina and Brazil
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The Economies of Argentina and Brazil

A Comparative Perspective

Edited by Werner Baer and David Fleischer

This book compares the successes and failures of the development and growth processes of Argentina and Brazil. It provides important insights into the different performances of these economies through a series of comparative essays written by Argentinian and Brazilian economists.
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Chapter 6: Comments on Part II

Andrew W. Horowitz


Andrew W. Horowitz In this comment I first summarize and assess the chapters sequentially, then provide a short synthesis and juxtaposition of the two articles. ARGENTINA – CÉSAR CIAPPA AND ANDRÉS GALLO Ciappa and Gallo have produced a broad analysis of the Argentinian agricultural sector with a focus on the potential distortionary effects of export taxation and quantitative restrictions. The analysis is well motivated and undertakes the ambitious endeavor of integrating a political–economic perspective with general equilibrium analysis. Due attention is given throughout to the citation of the relevant source literature. Section 4.1 provides a brief overview of the agro-industrial chain (AIC) and the historic incentives the federal government has had to tax the chain. Section 4.2 contains a fine introduction to some of the principal AICs in the country (cattle, wheat and soybeans) and an assessment of the impact of taxation on agricultural production, trade, poverty and the federal budget. Estimations of the direct and indirect effects of export taxes and quantitative restrictions are gathered from multiple sources to consider the impact of their elimination. The authors conclude that though export taxation is enticing to the federal government in the short run, the long-run effects are deleterious. Elimination of export taxation and quantitative controls, they argue, would yield net long-run benefits. Ciappa and Gallo’s chapter is a fine piece of scholarly work that adopts  a broad political–economic perspective to build a case for the elimination of export taxation and quantitative restrictions in Argentina. Though it is...

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