The rise of coffee in the Brazilian south-east: tariffs and foreign market potential, 1827-40

Abstract

During the period spanning independence in 1822 to mid-century, Brazil’s south-east shifted from specializing in the export of cane sugar to coffee. This article explores the mechanism underlying this shift by exploiting a wealth of new monthly data on the Brazilian and international coffee and cane sugar markets during the period 1827– 40. It argues that the timing of the coffee boom was driven by a rapid increase in foreign market potential associated with the abolition of the tariff on coffee in the US. It estimates that American tariff reform served to increase coffee exports and African slave imports by around one-fifth. American firms, wi th in direct li nks to th e slave trade, rapidly became major players in the export market in Rio de Janeiro, while non-American firms, t raditionally s pecialized in c ontinental European destinations, turned their sights on the American market.