THE BRAZILIAN DEFENSE INDUSTRY: A CASE STUDY OF PUBLIC-PRIVATE COLLABORATION (PUBLIC ENTERPRISE, ARMAMENTS)

This dissertation argues that unlike most Third World armaments producers, the Brazilian defense sector has indigenously developed internationally marketable technologies to become a global exporter of weaponry. It is contended that the firms' success in technological development and export promotion is based upon a pragmatic partnership with the state which encourages enterprise autonomy where possible but provides generous government support when necessary. Finally, it is concluded that the same pragmatic partnership which has guided the development of the defense sector is a relevant model for other industries in Brazil.; As described in Chapter II, this institutional case study conducted in Brazil between June and December of 1983 uses industrial organization concepts to explain the structure and conduct of the industry. Chapter III demonstrates how "seguranca e desenvolvimento," security defined to encompass strong economic foundations, fostered the development of a defense industry which pays as much attention to international markets as to the Brazilian military. Collaboration between the state and the defense firms is shown in Chapter IV to have occurred for economic as opposed to purely military reasons. Most importantly, patterns of state intervention in the defense industry illustrate how the state supplemented but did not supplant activity in the defense sector. The following two chapters then discuss how the partnership between the state and the firms served to promote indigenous technological development and exports. The state assumed much of the risk in technological development, providing support through government research and development centers. In the international sector, it was precisely the lack of government interference which has allowed the export of armaments on commercial, apolitical terms. Although Brazil might better have dedicated resources to alleviating poverty, it is concluded that given the goal of autonomous defense procurement, public-private collaboration in the Brazilian defense industry has more effectively provided both military security and economic rewards than an industry entirely operated by the military.