Economic structural change over time: Brazil and the United States compared

Abstract

Using input-output tables for the economies of Brazil and the United States, this comparative study focuses on changes in the economic structure of two large countries with different levels of development over time (1958-77 for the United States and 1959-80 for Brazil). The change in the economic structure is decomposed into three initial components (final demand, technology, and their synergistic interaction) and thereafter these components are further divided into change initiated within the sector and outside the sector. From this analysis it is possible to identify patterns of structural change in the two economies. The results indicate a rather remarkable degree of commonality in the patterns of growth processes in both countries, with more significant differences between sectors than between countries. The analysis confirmed earlier findings about the role of demand changes but was able to capture important differences in internal-to-sector versus external-to-sector sources of demand change.