Brazil has one of the world’s fastest growing economies and a fascinating history underpinning its evolution. This book presents an analysis of the state’s role in monetary policy, from the latter days of Portuguese rule, to the present day. Based on a variety of unknown archival sources, this study offers an alternative explanation for the rise and fall of Brazilian currencies. Monetary statecraft is a theory that accounts for the open ended, autonomous character of politics, the complex, recursive phases of public policy, and political development in the traditional sense of social inclusion. Unfortunately, there are few precedents for this type of analysis. This book fills this gap by tracing how Brazilian policy makers and observers have sought, experimented with, and reflected on a variety of forms and solutions for monetary policy since 1808. This book will be of interest to economists, financial historians and those interested in the history and economy of Brazil.

Banking and finance are often studied as specialized domains, governed by their own esoteric rules and concepts, and best cordoned off from broader comparative, historical and political considerations. This book develops an alternative approach. It focuses on the recent, strikingly deviant, experience of Brazil but goes well beyond that single case. It assesses financial sector reform and the consolidation of legitimate monetary authority in an era of globalization and democratization, and advocates the adoption of a holistic and contextualized perspective. It explores the cumulative potential of an incremental 'statecrafting' approach, in contrast to recently fashionable technical 'fixes' such as the idea that central bank independence provides a reliable and universal remedy for all monetary ills.

Introduction: the BRICS as a club -- Global power shift: the BRICS, building capabilities for influence -- BRICS collective financial statecraft: four cases -- Motives for BRICS collaboration: views from the five capitals -- Conclusion: whither the BRICS?

Financial statecraft' goes beyond sanctions against rogue states. The aims of financial statecraft may be defensive or offensive, its targets bilateral or systemic, and its instruments financial or monetary. Regions and countries profiled include Argentina, Venezuela, Brazil, India, Southeast Asia, China, and Japan.

'Financial statecraft' goes beyond sanctions against rogue states. National governments manipulate money, credit, and exchange rate resources to achieve a range of foreign policy goals. The aims of financial statecraft may be defensive or offensive, its targets bilateral or systemic, and its instruments financial or monetary. Since the global financial crisis of 2008-9, rising multipolarity in international relations has given 'new kids on the block' such as China, India, and Brazil the opportunity - and desire - to move beyond the old forms of defensive financial statecraft, such as debt default, to new and assertive types of international financial statecraft, including collective pressure on the industrial democracies to expand the IMF quotas of emerging powers. An open question for the future is whether the leaders of major emerging powers will continue to cooperate with the United States, Western Europe, and Japan in global financial governance - or whether some of them will move toward more direct challenges to the existing system's governing principles or its power hierarchy.

divAs trade flows expanded and trade agreements proliferated after World War II, governments—most notably the United States—came increasingly to use their power over imports and exports to influence the behavior of other countries. But trade is not the only way in which nations interact economically. Over the past two decades, another form of economic exchange has risen to a level of vastly greater significance and political concern: the purchase and sale of financial assets across borders. Nearly $2 trillion worth of currency now moves cross-border every day, roughly 90 percent of which is accounted for by financial flows unrelated to trade in goods and services—a stunning inversion of the figures in 1970. The time is ripe to ask fundamental questions about what Benn Steil and Robert Litan have coined as “financial statecraft,” or those aspects of economic statecraft directed at influencing international capital flows. How precisely has the American government practiced financial statecraft? How effective have these efforts been? And how can they be made more effective? The authors provide penetrating and incisive answers in this timely and stimulating book. /DIV