State Planning, Price Controls, and Economic Life: The Case of Brazil’s Estado Novo, 1937–45

Beyond the human and environmental destruction caused during World War II, this global war was also marked by precipitous economic hardships and crises. Brazil, an Allied Power after 1942, confronted inflation, food scarcity, thin foreign reserves, and trade blockades. In response to this global crisis, economic historians have emphasized the ways in which the Brazilian Estado Novo, a dictatorial and corporatist regime, intervened in the national economy, with a focus on strategies to develop mining, oil, steel, and chemical industries. What scholars have paid less attention to is how this enthusiasm for top-down planning and regulation impacted everyday market transactions.

This paper explores how economic life in Brazil was transformed by wartime statist experiments for national development. It centers on the price controls and market regulations imposed to stave off inflation and food scarcity. A new category of crime aimed to protect the “popular economy” by targeting merchants, peddlers, grocers, and owners of lanchonetes (snack bars) who were denounced or caught red-handed in acts of price gouging, speculation, or black market activities. The Tribunal de Segurança Nacional, a special military tribunal created in 1936 to repress political dissidents, was responsible for these trials, an institutional choice telling of how the economy had transformed into a matter of national security. With these cases, we find evidence of how citizens understood and navigated a marketplace increasingly regulated by a cumbersome and often ad hoc state bureaucracy. More so, this inquiry into how legal institutions were deployed to reorganize economic life also illuminates the legal history of the Estado Novo, as judges and bureaucrats alike increasingly saw law an instrument for state-led development in Brazil.