Regional funding and regional inequalities in the Brazilian Northeast

Kênia Souza

27/02/2018 – Terça-feira
18:30 às 19:00
Sala: Auditório do CCSA II


The purpose of this article is to evaluate the macroeconomic, regional and sectoral impacts of the Northeast Constitutional Financing Fund (FNE). For this, simulations are performed using a TERM-CEDEPLAR computable general equilibrium model, calibrated for the year 2013, and composed by 27 Brazilian states and 20 economic sectors. The simulations were carried out based on FNE sectorial and regional investment data for the years 2014 and 2015, allowing to isolate the effect of those funding to the regional economy. The main results indicate that FNE expenditures between 2014 and 2015 have the potential to increase Northeast GDP by 3.51% until 2025, and the most benefited states are Piauí, Ceará, and Rio Grande do Norte. Additionally, our estimations show and decrease in regional inequality between Northeast states of 0.46% measured by regional Gini. In general, the results are compatible with the objectives of the fund, although the total effects, mainly on regional inequality, are quite modest.



Federação das Indústria do Estado de Sergipe – FIES

Observatório de Sergipe


University of Illinois at Urbana-Champaign

Universidade de Oviedo
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