Effects of higher commodity prices on exports of manufactures: the case of Brazil

This study seeks to determine whether the increased earnings of Brazil’s trading partners that benefited from the boom in commodity prices during the 2000s spurred Brazilian exports of manufactures to those countries. It begins with the hypothesis that there is a positive link between Brazil’s exports of manufactured goods and the increased revenues of its trading partners derived from the robust performance of their exports of natural resources. A two-stage hierarchical statistical model based on a panel data structure is used to estimate a crosss-section data model. To our knowledge, this strategy has not been used before to study the behaviour of Brazilian manufactured exports during the economic boom of the 2000s fuelled by the commodity supercycle.