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In the last decades the Brazilian agriculture had a strong growth. Our hypothesis is that most of that growth may be attributed to two general factors, which may conveniently be related to two types of shocks acting upon agriculture: demand-related and technological supply-related shocks. Demand shocks are originated both from domestic economy and from external markets. We use Blanchard and Quah (1989) type of economic model to test the relative importance of supply and demand shocks on Brazilian agricultural growth. Our results indicate that supply and demand shocks have permanent effects upon agricultural output and prices. We estimate that the agricultural output growth in Brazil is attributed in large proportion to yield increases and that integration to international markets was important to assure the profitability of continuous use of new technology that led to yield improvements. This is why exchange rate plays is relevant in explaining the performance of the Brazilian agriculture. We anticipate that, if investments in science and technology are maintained and international integration expanded, Brazil will be able to substantially increase its supply of agricultural products both for domestic and foreign markets. Nas últimas décadas a agricultura brasileira teve um forte crescimento.

Drawing upon the Global Trade Analysis Project (GTAP) database, and other time series data, we construct a multi‐sector Ramsey model that shows the transition growth of the Brazilian agricultural sector and its effects on growth of the industrial and service sector of the economy, with particular emphasis given to the years 1994–2010. Our results capture the importance of the agriculture's capital intensity and the sector's factor productivity on the sector's growth, the substitution of capital for labor in agriculture, and the sustaining of agriculture's share in Brazilian GDP. These features are rather unique among emerging economies, most of which have experienced a transition out of agriculture and growth in nonfarm production relative to agriculture.

Brazil is a key player in the global beef markets having generated 15% of global production, and approximately 20% of world exports in 2018. Productivity improvements will be indispensable if the Brazilian beef sector wants to maintain its position as a key player in both the domestic and international markets. In light of the aforementioned, this study makes two key contributions to the agricultural productivity literature on Brazil. First, it estimates the production technology used in the Brazilian beef cattle sector using stochastic production frontier methods that account for exogenous factors that impact the production environment. Second, using the estimated coefficients as weights, it decomposes a total factor productivity (TFP) index that tracks various sources of productivity growth including: technical efficiency, technological change, scale efficiency, and environmental efficiency. By utilizing farm‐level data this study generates deeper insights into the dynamics driving beef cattle production at the most disaggregated level. Results indicate that TFP growth averaged 1.73% per annum and was primarily driven by scale efficiency, which increased at 1.39%. Meanwhile, technical efficiency declined at a rate of −0.03% per annum. [EconLit Citations: D24, O13, Q15].

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