6
J. Swart and L. Brinkmann
under way. When economies eventually reach such a level of complexity, environmental degradation will level off and start to decline.
This paper investigates the validity of the complexity-environment nexus for the
case of Brazil. More precisely, we analyse the extent to which the productive structure
in different Brazilian municipalities, states and metropolitan regions influences the
quality of the environment. Brazil’s recent economic history, marked by the transition
from a closed to an open economy in less than three decades; the importance of the
environment for the industry and society; and regional diversity provide a strong case
to conduct a study specifically for Brazil.
Until the 1980s and early 1990s, Brazil’s economy was characterised by strong
import substitution policies, macroeconomic policies aimed at stabilising the prevalent hyperinflation, and an industry producing almost exclusively for the domestic
market. With the creation of the free trade area Mercosur in 1991, subsequent privatisations, and the withdrawal of the state from production, Brazil experienced a period
of relatively high growth rates (Lo and Hiscock 2014). Figure 1 shows that Brazil
experienced positive growth throughout the mid-1990s and early 2000s. Higher competitiveness and an ensuing export boom—especially of agricultural products such
as soybean and cocoa—helped the country position itself as a promising emerging
market. During the same period, however, Brazil’s economy became steadily less
complex, a fact that can certainly be attributed to the relevance of agriculture as a
driver of its economic development. Ranking as the world’s 29th in terms of economic
Fig. 1 Economic growth and economic complexity in Brazil (1990–2015). Data sources World
Bank, Observatory of Economic Complexity
J. Swart and L. Brinkmann
under way. When economies eventually reach such a level of complexity, environmental degradation will level off and start to decline.
This paper investigates the validity of the complexity-environment nexus for the
case of Brazil. More precisely, we analyse the extent to which the productive structure
in different Brazilian municipalities, states and metropolitan regions influences the
quality of the environment. Brazil’s recent economic history, marked by the transition
from a closed to an open economy in less than three decades; the importance of the
environment for the industry and society; and regional diversity provide a strong case
to conduct a study specifically for Brazil.
Until the 1980s and early 1990s, Brazil’s economy was characterised by strong
import substitution policies, macroeconomic policies aimed at stabilising the prevalent hyperinflation, and an industry producing almost exclusively for the domestic
market. With the creation of the free trade area Mercosur in 1991, subsequent privatisations, and the withdrawal of the state from production, Brazil experienced a period
of relatively high growth rates (Lo and Hiscock 2014). Figure 1 shows that Brazil
experienced positive growth throughout the mid-1990s and early 2000s. Higher competitiveness and an ensuing export boom—especially of agricultural products such
as soybean and cocoa—helped the country position itself as a promising emerging
market. During the same period, however, Brazil’s economy became steadily less
complex, a fact that can certainly be attributed to the relevance of agriculture as a
driver of its economic development. Ranking as the world’s 29th in terms of economic
Fig. 1 Economic growth and economic complexity in Brazil (1990–2015). Data sources World
Bank, Observatory of Economic Complexity