The adoption and persistence of slave labor are pointed out as the main factor behind the low income trajectory in Brazil throughout its history. This is what a study indicates that reconstructs the country’s GDP per capita between 1574 and 1920 based on historical data on wages and prices, gathered by economists Guilherme Lambais and Nuno Palma.
The research, published by Folha de S. Pauloindicates that the country stopped converging with richer economies in the 17th century and only began to grow more consistently from the second half of the 19th century onwards.
The work, entitled “How a nation was born: Brazilian economic growth, 1574-1920”, brings together more than 30 thousand historical records of wages and prices to estimate GDP per capita over more than three centuries.
Estimates suggest that Brazil had a relatively high level of income at the beginning of colonization, but entered a prolonged cycle of stagnation from the mid-17th century. During this period, average income stopped growing for about two centuries.
According to the authors, the main factor behind this trajectory was the economic structure based on slave labor. The model would have created a dynamic of low wages, low adoption of technology and, as a consequence, limited productivity.
The research points to three central mechanisms. The first was the condition of the enslaved, kept at a subsistence level. The second involves the effect on free workers, whose wages were pressured downward by the abundant supply of cheap labor. The third is related to the discouragement of innovation, as the low cost of labor reduced the need for efficiency gains.
Continues after advertising
This pattern began to break down only with the weakening of the slave trade. From then on, the economy began to record more consistent productivity gains, with repercussions on income growth.
The results are in line with classic interpretations of Brazilian economic formation. The authors state that the time frames identified coincide with hypotheses raised by Celso Furtado, especially about the drop in income in the 17th century and the recovery associated with the expansion of coffee in the 19th century. For Lambais, “Furtado’s timing was correct”.
At the same time, the central explanation of the study is close to the thesis of economist Nathaniel Leff, who in the 1970s associated Brazilian economic backwardness with the continuous supply of cheap labor.
The study contributes to a recurring debate about when and why Brazil moved away from more developed economies. By offering a broader empirical base, the research attempts to reduce uncertainty about the evolution of income in the country throughout its history.
