Sources of Comparative Advantages in Brazil

Based on the Heckscher-Ohlin-Vanek model, this paper investigates relative factor abundance in Brazil, as revealed by its international trade. We study two different time periods: one characterized by high trade barriers (1980 to 1985) and the trade liberalization period (1990 to 1995). Two alternative methodologies are used: the estimation of factor intensity regressions on net exports and the direct computation of factor content in net exports. In the factor intensity regression, we incorporate techno- logical changes that might have occurred over time, and those turned out to be significant. Both methods yield the same results: the Brazilian in- ternational trade reveals relative abundance in capital, land and unskilled labor, and scarcity in skilled labor, with qualitatively equivalent results for the two time periods studied.