What can we learn from Brazil’s inclusive growth and development?

Brazil has emerged as a significant economic power in the last decade, combining accelerated growth with falling poverty and inequality. The pro-poor character of economic growth in Brazil over this period stands in marked contrast to the experience of other countries. This achievement is globally recognised.

Based at the Global Development Institute (GDI) at the University of Manchester, IRIBA brought together an international team of researchers to ask whether there is a Brazilian model of development, and to investigate the nature and sources of the country’s inclusive growth performance.

The main findings include that:

1. A new Brazilian development model has taken shape over the last two decades, one rooted in a strong social and political consensus as to the need to tackle poverty and inequality.

2. Brazil developed a comprehensive and effective set of institutions to manage its economy, providing both stability and the fiscal space to support innovative social policies. This has led to a decline in poverty and inequality alongside an overall long-term trajectory of inclusive growth.

3. More effective institutions helped to dramatically raise agricultural productivity, enabling Brazil to become a major exporter. Long-term government investment in agricultural research provided a crucial boost.

4. Inclusive growth has been achieved through a combination of labour market and social policies, ensuring the benefits of economic growth reach the poorest Brazilians. Furthermore, the data indicate that the focus on disadvantaged groups in the expansion of social policy had positive, measurable effects on growth.

5. Despite significant progress, Brazil still faces big challenges. Investment in infrastructure has proved insufficient and the impact of the global economic slowdown is resulting in considerable stress on the social contract. Additionally, the country has taken important institutional steps towards tackling widespread corruption, but the problem remains current.

Read an expanded list of these points.