Is Brazil successfully “developing” in economic and political terms or is it stagnating or even decaying? Brazil in Transition addresses this important question about a country that is the fourth biggest democracy and eighth or ninth largest economy in the world, depending on how the latter variable is measured.

This book, written by two economists and two political scientists, is an ambitious attempt to explain Brazil’s economic and political development over the last few decades. Lee J. Alston and his coauthors argue, against the current wave of pessimism about Brazil, that its development has been “truly extraordinary for a middle-income country” (p. 218) and has consistently moved the country toward what the economist Douglass North and his colleagues called an “open access society” (North, John Wallis, and Barry Weingast, Violence and Social Orders: A Conceptual Framework for Interpreting Recorded Human History, 2009) Their explanation is an institutionalist one. It is that there was a “window of opportunity” in Brazil in the mid-1990s when leadership mattered. Fernando Henrique Cardoso and his allies initiated and sustained the Real Plan, setting Brazil on the path toward fiscally responsible social inclusion. Beliefs changed within the dominant network running the country (i.e., elites), leading to the strengthening of institutions that produced fiscal probity, the rule of law, steady economic growth, and the deepening of democracy. After this window of opportunity closed in 1999, leadership ceased to matter as it had before, and Brazil was on autopilot. Its trajectory did not change, even during the 14 years of rule by presidents from the Workers’ Party (Partido dos Trabalhadores, or PT). Attempts by PT governments to deviate from the core belief in fiscally responsible social inclusion resulted in corrections from strong institutions in a process the authors describe as “dissipative inclusion” (p. 213).

The book’s best sections are the economic history in Chapters 3 through 6. But this is a selective history, based on stark dichotomies, that moves in one direction: toward ever-greater economic liberalism. The authors imply that institutions cause economic development, which are themselves caused by underlying beliefs (pp. 14–15). This assertion is debated in the political economy literature. Endogeneity and the small number of cases in relation to multiple potential causal variables make it difficult to demonstrate the direction in which the causal arrow runs. It could go in the opposite direction, such that economic development creates the conditions for capable institutions, which in turn shape beliefs (see, for example, Adam Przeworski, “The Last Instance: Are Institutions the Primary Cause of Economic Development?” in European Journal of Sociology 45, 2004, and Herman Schwartz, “Dependency or Institutions? Economic Geography, Causal Mechanisms, and Logic in the Understanding Development,” in Studies in Comparative International Development 42, 2007).

The economic history is selective because the “pioneer countries” that are of greatest interest to the authors are France, the United Kingdom, and the United States, whose institutions are described as “more or less the same” (p. 172; this observation might surprise some comparative political economists). The experience of developmental states in East Asia that industrialized after World War II and did not follow a liberal economic model is largely ignored (see, for example, Alice Amsden, Asia’s Next Giant: South Korea and Late Industrialization, 1992; and Robert Wade, Governing the Market: Economic Theory and the Role of Government in East Asian Industrialization, 1990).

The authors’ ambition has a downside: they may be trying to explain too much. Accounting for economic growth is hard enough, but Alston et al. want to explain economic and political development, which includes “economic improvements” and “changes in social relations . . . and political institutions” (p. 5), as well as the “rule of law for all, political openness and universal participation, free entry and exit for all sorts of organizations . . . checks and balances, electoral uncertainty ex ante, and certainty ex post” (p. 6), as well as lower inequality, lower poverty, a bigger middle class, and more competitive economic and political markets (p. 17). By overloading their dependent variable with numerous economic and political traits they find desirable, they inadvertently lock themselves into the assumption that all good things go together. This is the optimistic equation of modernization theory, the belief that economic development and political democratization march in lockstep together, an idea effectively demolished by Guillermo O’Donnell 45 years ago (see his Modernization and Bureaucratic-Authoritarianism: Studies in South American Politics, 1973). In so doing, they rule out the possibility of disjunction, the simultaneous existence of multiple economic and political trajectories that cannot necessarily be explained by a single causal mechanism.

The authors define beliefs, the fundamental driver of change in their account, as “the subjective views of actors about the way the world works” (p. 180). Although they claim to draw on Douglass North for the definition, North himself defines beliefs in a more complex way as “both a positive model of the way the system works and a normative model of how it should work” (North, Understanding the Process of Economic Change, 2010: 2). In addition, North takes into account divisions in perception about society. In contrast, Alston et al. simplify his concept, reducing beliefs to the beliefs of Brazilian elites. In doing so, they downplay the profound disagreements in Brazil about how the economy and politics work, and what the ideal patterns of economic development and democracy are.

It is not entirely clear how the authors determine what the dominant belief among elites in each era is, and when the eras begin and end. They divide Brazil’s recent development trajectory into three phases. These are 1964–84, during a dictatorship, when the dominant belief is said to be “developmentalism” (pp. 33–36); a period of “populist developmentalism” (pp. 36–38) under the new democracy, from 1985 to 1993, when the dominant belief is described as “social inclusion” (p. 34); and a period of open and stable economic development, ushered in by Cardoso, in which the dominant belief was supposedly in “fiscally sound social inclusion” (p. 34). This typology ignores significant differences within eras, and insufficient evidence is provided to justify the characterizations of the dominant belief of each era. Apart from rather inconclusive World Value Surveys done in 1989–93 and 2010–14 in 18 countries, including Brazil (pp. 31–32), the existence of dominant beliefs is inferred from the course of events, rather than demonstrated independently.

In addition, the dominant beliefs identified by the authors are not comparable beliefs, nor are the first and third of them mutually exclusive. “Developmentalism” refers to a particular orientation to macroeconomic policy, and in particular the role of the state in promoting industrialization and the growth of the domestic market (p. 45). On the other hand, social inclusion and fiscally sound social inclusion are beliefs about the relationship between fiscal and social policy. Fiscal responsibility and developmentalism are not inherently antithetical, even though they were in practice during the first term of Dilma Rousseff. These unexplained inconsistencies suggest that the authors chose the dominant belief of each era rather arbitrarily, and did so in order to reinforce their predilection for a certain type of development.

It is also unclear why a punctuated equilibrium model, rather than a model of more gradual change, should apply to Brazilian development, nor how the authors identify the “window of opportunity” (p. 97) that is so pivotal to their analytic narrative. In this account, President Cardoso’s first term in office is uniquely transformative, setting in motion all the other subsequent changes over the next 18 years, from poverty reduction to increases in educational attainment to declines in income inequality and the accumulation of foreign reserves, while all the other periods were merely governments on “autopilot.” Cardoso’s exceptional “moral authority,” “knowledge,” and actions “for the betterment of society” (p. 15) are described in reverential and personalistic detail, while Lula da Silva is dismissed brusquely as “not a leader” by their definition (p. 22; the definition of leadership is on pp 25–26). This dichotomy in the treatment of Brazil’s two most important presidents of the democratic era only makes sense if the views of nonelites are discounted in the evaluation of someone who qualifies as a leader. It also makes the authors’ denial that they endorse any party or president, or any specific policy or program (pp. 18 and 166), seem a bit disingenuous.

The authors are undoubtedly right to view the current anticorruption investigations as a step forward for accountability (p. 149) because they are challenging the impunity previously enjoyed by elected officials and company executives. However, the book could have looked somewhat more critically than it does at the auditing, tax, judicial, prosecutorial, and police bodies that are part of that investigation, because they are not entirely free of political bias and corruption themselves and are sometimes unaccountable to other parts of the state. Furthermore, their actions are unlikely to automatically move Brazil further toward an open-access society unless complemented by political and judicial reforms that change incentive structures (see Aline Pavaneli and Wilson Kirsche, “ʹÉ Preciso ir além da Lava Jato,’ diz Deltan Dallagnol sobre combate à corrupção e à impunidade,” in Globo.com [April 29, 2017] URL: g1.globo.com/pr/parana/noticia/e-preciso-ir-alem-da-lava-jato-diz-deltan-dallagnol-sobre-combate-a-corrupcao-e-a-impunidade.ghtml).

The authors interpret the massive protests of June—July 2013 in Brazil in a highly idiosyncratic way. In a section that has a tacked-on feel to it, they use a highly abstract institutional possibility frontiers diagram (p. 212)—and no empirical evidence—to argue that the protesters were motivated by a desire to move the Rousseff administration away from state intervention and toward a more laissez-faire economic and political system (p. 213). Here, the protests seem to serve as a pretext for editorializing against the Rousseff administration’s “policies of picking national champions, discretionary subsidies, greater public expenditure in the face of lower revenues, creative accounting in public finances, tinkering with public tariffs for political gain, and importing doctors from Cuba” (p. 213). The authors do not show how the protests—which were highly diffuse and pluralistic—sprang from or expressed the existence of these views among the protestors. Scholars who have studied the protests might be particularly skeptical of this argument. The protestors’ frequent demands for “FIFA-standard” schools and hospitals would seem to indicate a desire for better state services, rather than the mere rollback of the state.

In summary, Brazil in Transition offers an interesting argument that could be applied to other cases. However, its conceptual framework is loosely justified in empirical terms in places. Furthermore, its stark contrast of Cardoso’s first term (when there was a critical juncture) and the alleged autopilot of the PT years neglects other important incremental changes along the way and downplays the tensions between liberalism and developmentalism that permeated federal administrations throughout the period. The book’s biggest flaw could be its failure to acknowledge how far from an open-access society Brazil still is for many nonelite citizens, who endure chronic levels of insecurity and violence, including police violence, and how polarized the country is when it comes to what desirable economic and political development looks like.