Co-evolution of Industry Strategies and Government Policies: The Case of the Brazilian Automotive Industry

Abstract

This study examines the evolution of the automotive industry in Brazil and its key drivers. We argue that the rules of the game -industry policies -are an outcome of exchanges between the host government and industry. These arise from changes in economic and political environments and interdependence between industry and the country's economy. To this end, we draw upon literature on institutions and co-evolution to understand the industry footprint over a 50-year period, as well as its relationship with changes in government policies. This study generates new insights on institutional and co-evolution political perspectives by showing that the rules of the game are not only the making of the government, but are also the result of interdependencies between industry and government.

Wages, Price, and Profit: Protection and Value Capture in the Mercosur Automotive Industry

“…During the decade of economic growth that began in the early 2000s in South America, discussions abounded on the transformations in various production sectors, with the automotive industry of Brazil and Argentina being one of the focal points of debate. Among the central issues was whether the sustained expansion of production and consumption of vehicles and the installation of new plants and the increase in foreign trade, among other things, were evidence of the consolidation of a structural transformation that changed the historical role of these countries in the global economy (Arteaga García, Guevara, andPinto, 2020: Barbero andMotta, 2007;Duarte and Rodrigues, 2017). With Alejandro Fitzsimons and Sebastián Guevara are professors at the Universidad de Buenos Aires and researchers with the Consejo Nacional de Investigaciones Científicas y Técnicas, Fitzsimons at the Universidad Nacional de Quilmes and Guevara at the Centro de Estudios e Investigaciones Laborales in Buenos Aires.…”