Democracy, economic growth and volatility in Brazil: what is the causality?

The impact of democracy on economic growth has been studied a great deal in recent years. This study is intended to add to this empirical literature by analyzing its relationship specifically in Brazil, by means of time series cointegration techniques. With a long time series, that goes from 1900 to 2022, we identified a robust positive, causal relationship between democracy and growth using a new Brazilian GDP database. In addition, a negative causal relationship was identified between democracy and growth volatility, but with results that were not as sturdy as those in the previous relationship.