This study seeks to identify the determinants of Brazil's favourable export performance until the mid-1980s, especially in the field of manufactured goods. Two hypotheses figure prominently in the analysis. The export success may be due to Brazil's specialization in industries which made intensive use of the country's relatively abundant productive factors. Alternatively, economic policies may be responsible for the success in manufactured exports.

This book challenges the established, neoclassical view of industrial success in developing countries. By re-examining the role of government intervention in the industrialization of Brazil and South Korea, it seeks to show that the key to industrial success does not lie in a simple combination of outward-orientation and laissez-faire, but in the government's success in remedying crucial market failures in the product and factor markets.