Atlantic Economic Journal

, Volume 44, Issue 2, pp 197–224 | Cite as

Why Countries Transition? The Case of Brazil, 1964–2016

  • Lee J. Alston
  • Marcus André Melo
  • Bernardo Mueller
  • Carlos Pereira


Economic and political development are contextual. Nevertheless, there are some general elements in the process of institutional persistence and change. We present a framework that goes beyond the standard institutional analysis and adds the concepts of beliefs, leadership, and windows of opportunities in a dynamic process of change. Beliefs of the dominant network may lead countries to choose institutions that do not promote growth and prosperity, even in cases where those in power seek to pursue the common good. Leadership during windows of opportunity helps to determine when, how, and why beliefs change over time. Although each of these concepts alone is not novel in the literature, our major contribution is the evolutionary dynamic. To illustrate the framework, we flesh out the dynamics with a case study of Brazil from 1964 to 2016.


Beliefs Leadership Institutions Windows of opportunity Brazil Development 


O10 O43 O57 N10 D83 



This paper relies heavily on our book, Brazil in Transition: Beliefs, Leadership, and Institutional Change, published in 2016 by Princeton University Press, and Lee Alston’s 2015 William S. Vickrey Distinguished Address presented at the 80th International Atlantic Economic Conference in Boston, 8-11 October 2015. The title of the paper is a play on Why Nations Fail by Acemoglu and Robinson (2012). We differ by stressing the roles of context, beliefs, and leadership for successful transitions to open economic and political orders. We benefitted greatly from lengthy discussions and correspondence with Thráinn Eggertsson, Avner Greif, Douglass North, James Robinson, John Wallis, and Barry Weingast. For comments on earlier drafts, we thank Eric Alston, Andy Baker, Robert Bates, Eric Brousseau, David Brown, Murat Iyigun, Richard Jessor, Joseph Jupille, Thomas Mayer, Joel Mokyr, Aldo Musacchio, Tomas Nonnenmacher, Joaquim Oliveira, Samuel Pessoa, Jerome Sgard, Ken Shepsle, Steven Webb, and the participants at the following seminars and conferences: the Institutions Program workshop at the University of Colorado; a seminar at the Getulio Vargas Foundation; the conference honoring Douglass North’s 90th birthday; the Economic History Association Annual Meeting (Boston); and the workshop on Legal Order, the State, and Economic Development in Florence, Italy. We also thank the Rockefeller Foundation for a visiting residency in Bellagio where we launched our project.


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Copyright information

© International Atlantic Economic Society 2016

Authors and Affiliations

  • Lee J. Alston
    • 1
  • Marcus André Melo
    • 2
  • Bernardo Mueller
    • 3
  • Carlos Pereira
    • 4
  1. 1.Ostrom Workshop and Department of EconomicsIndiana University; NBER; BloomingtonUSA
  2. 2.University of PernambucoRecifeBrazil
  3. 3.University of BrasiliaBrasíliaBrazil
  4. 4.School of Public and Business Administration (EBAPE), Getulio Vargas Foundation (FGV)Rio de JaneiroBrazil

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