Pragmatic Economics and Sustainable Finance

Building solutions for a better world, by Rodrigo Zeidan

Development Economics

I believe that every economist wants, at one time or another, to tackle issues that are relevant to sustainable economic development. Economics of Global Buinsess (forthcoming, MIT Press) is the culmination of all my experience teaching macroeconomics, doing applied research for international organizations, living and moving around three continents, and integrating the other areas of my work. Besides my academic research, I developed a plan, alongside another senior economist, for Brazil to help solve Europe’s refugee crisis. I also had a newspaper about the Chinese economic development in one of the main Brazilian newspapers, and published other articles in the international media about growth and development. You can find some of my recently published research in development economics below.

The life-cycle of national development banks: The experience of Brazil’s BNDES – The Quarterly Review of Economics and Finance (2016), with Ernani Torres.

We posit a life-cycle hypothesis for the evolving role of National Development Banks (NDBs) using the case of one of the largest such institutions in the world, the Brazilian Development Bank (BNDES). NDBs are a particularly important institution for channeling long-term credit in less developed financial markets. However, we argue that as countries develop their financial markets, NDBs should share this role with other local banks and specialize their focus, eventually disappearing altogether. In the Brazilian case, we show how the BNDES evolved from a purveyor of long-term credit to a more complex financial institution. The BNDES was the most important tool used by the Brazilian government as a countercyclical response to the financial crisis. For many developing countries, institutions like the BNDES may be a tenable solution for building long-term local financial institutions and markets, and developing specialized human capital. However, they also pose potential risks centered on issues of scalability, crowding out, graft and inefficiency

A dead-end tunnel or the light at the end of it: The role of BRICs in European exports – Economic Modelling (2016), with Svetlana Fedoseeva.

In this article we use a dynamic nonlinear cointegrating approach to better understand trade factors relevant for European exporters in the BRIC (Brazil, Russia, India and China) markets across industries. Results show that all trade determinants in our models, i.e. exchange rates, relative prices and foreign demand, are relevant for European exports to the BRICs, although their impact is heterogeneous across countries and industries. We find that trade patterns are stable over time; there is an asymmetric response to exchange rate movements, and that three clusters, with distinct characteristics, comprise over 90% of European exports to the BRIC’ markets. Results shed some light on the drivers of European-BRICs trade and the way recent geo-political and economic developments in BRICs might affect European exports.

Is there a Brazilian model of development? – Policy in Focus, United Nations (2015), with Ernani Torres.

As the world begins to wake up to the dire social and economic consequences
of rising inequality, we must recognise that it is not an inevitable side-effect
of economic growth and development. Many Latin American countries,
and Brazil in particular, have demonstrated it is possible to achieve inclusive
growth, which has reduced inequality and poverty.

The displacement effects of Chinese exports on the US clothing market – Journal of Chinese Economic and Business Studies (2015)

This paper focuses on the displacement of other countries’ exports by Chinese exports in the US clothing market during the 2002–2010 period (sector 62 of the Harmonized System). The main contribution is to consider individual product data and its dynamic for finding evidence of displacement. Data on Taiwan show a particularly interesting result, with a conjecture regarding disappearance of tariff arbitrage and re-exports of Chinese apparel to the USA through Taiwan.

Restructuring Brazil’s National Financial System – IRIBA Working Paper (2014), with Ernani Torres and Luiz Macahyba.

We try to present the recent development of the Brazilian Financial System and its institutions, from 1994 to 2014. We also analyze the impact of the rapid credit growth after 2004 and the role of state-owned banks.

Social Networks and Urban Poverty Reduction – Emergence (2009), with Jeff Goldstein.

Policies to reduce urban poverty are increasingly important, not only in developing but also in developed countries. Yet, urban poverty seems invariant in relation to economic growth. Although different methodologies and conceptual frameworks have surfaced to deal with poverty reduction, the way to effectively achieve this objective is not clear. In this paper we develop a comprehensive approach to deal with urban poverty reduction policies by making up for the lack of attention to social networks in nearly all poverty reduction programs or policies. We critically assess this neglect of social network connectivity in two case studies, Favela-Bairro, or slum revitalization, in the city of Rio de Janeiro and a program in workforce development in New York City. The aim here is to show why it is necessary for urban poverty production policies to incorporate social network connectivity with the marginalized and disenfranchised poor. We offer guidelines as to how this kind of social network connection of the poor with the non-poor populations of our urban environments may proceed

Development Economics and Social Entrepreneurship- A Recursive Social Capital Accumulation Model – Emergence (2009)

An essay on the linkage between development economics, complexity theory and social entrepreneurship.

Brazil: a Tale of Two Countries – Longitude (2013)

On hindsight, an essay on missed opportunities. It shows the relevance of the two major reforms of the XXI century, the Fiscal Responsibility Law and Bolsa Familia.

Empty Homes in China – Longitude (2013)

An explanation on why there are plenty of empty homes in China. A story of uneven development.

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