Abstract
This article analyses the ways in which the recent structural evolution of the Brazilian industrial sector has been profoundly influenced by rapid sequential changes in the microeconomic and macroeconomic policy environment. As Brazil moved towards greater openness and macroeconomic stability in the second half of the 1990s, strategies pursued within the industrial sector underwent radical change as enterprises sought to realize badly needed improvements in international competitiveness. This article argues that this process can be best understood in terms of a dynamic, two‐way interaction between microeconomic and macroeconomic forces. In particular, it is suggested that ongoing structural change within Brazilian industry may be exerting a significant influence on the nature of current and prospective macroeconomic conditions.
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