The contractionary effects of PEC Emergencial: the impact of the uncertainty of public sector wage payments on the Brazilian economy

• Autor(a) principal: Domingues, Edson Paulo
• Data de Publicação: 2020
• Outros Autores: Cardoso, Débora Freire, Magalhães, Aline Souza, Simonato, Thiago Cavalcante
• Tipo de documento: Artigo
• Idioma: por
• Título da fonte: Gestão e sociedade
• Texto Completo: https://ges.face.ufmg.br/index.php/gestaoesociedade/article/view/3174
• topic: Public expenditure; austerity; labor; wages; computable general equilibrium; Gasto Público; Austeridade; Emprego; Salários; Equilíbrio Geral Computável

This work aims to project the main economic impacts of the reduction of up to 25% of salaries and working hours of the civil servants, foreseen in the Proposed Constitutional Amendment (PEC) 186. The results point out significant negative effects on the sectors, in addition to effects on GDP and employment in the short and medium term. The simulations indicate that GDP may decline from -1.4%, to the 25% cut, to -0.30%, to a 5% cut, as a short-term effect of this type of policy. In the medium term, the negative impact is permanent if the measure is not reversed: -1%, for a 25% cut, and -0.2%, for a 5% cut.   Keywords: Public expenditure, Austerity, Labor, Wages, Computable General Equilibrium.