Effects of the Public Policies on the Natural Rubber Production in Sao Paulo and Mato Grosso States

The objective of this study was to evaluate the effects of the government intervention on the expansion of the natural rubber production in Sao Paulo and Mato Grosso states. The method used was the policy analysis matrix, developed by MONKE and PEARSON (1989). The results showed that the production of natural rubber in those states has conditions to face the liberalization changes that have been taking place in the international market. The government's role in that process is relevant in order to promote the development of that activity and to reduce the distortions, since these impede that the market signals guide the producer decisions in an integrated economy into the world market. Some policy measures can be carried out to improve the competitiveness of the natural rubber in Sao Paulo and Mato Grosso states, which are related with reductions of the tax aliquots on the production; with interest rate in the financings; and with labor legal requirements that increase the production costs. It is, also, important to underline the positive effects of technological changes. It is necessary to the government to be conscious with the effects of its policies. For that, it is important that the adoption of those policies provides to the production of rubber natural larger competitiveness. In that perspective, the government intervention could generate larger social benefits, if the divergences between the social and the private valuations were reduced. In the medium term, the policy reorientation benefits both the producers and the consumers, taking to a larger incentive to the local production of this product.