The Effects of the Real Plan
The Brazilian labor market has been passing through great transformations during the 1990s. These transformations originate, mainly, from the reorientation of the Brazilian model of development and from the success of the Real Plan.
The Brazilian model of development went, in this decade, from a protected industrialization style to one of an open and competitive economy. The Brazilian economy's insertion in the globalization process generated significant alterations of the trade and capital flows, of the technological, managerial and organizational bases of enterprises and of the market and labor relations. Brazil's economic integration to the world economy is a process on the march. One of the most important expressions of this integration was the formation of the Mercosul.
The success of the Real Plan, in its turn, observed in the sharp downfall of the IPC-Fipe in Graph 1, brought the stability of prices to the country's daily economic routine.
The control of inflation brought cost transparency for the enterprises and increased the workers' real income.
The elimination of the inflation tax was a benefit mainly for the poor, transferring income from the upper and middle segments of the population to the layers that were at the lowest stratum of the income distribution.
The integration of the Brazilian economy to the process of competitive globalization and the achievement of economic stability were the most important economic facts of the first half of the 1990s in Brazil. These two facts are having an influence on the way the country's labor market functions and are changing the capital-labor relations.
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GRÁFICO 1 PRICE INDEX GROWTH - IPC/FIPE
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