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This paper uses Brazilian quarterly data, from the period January/2002 to June/2015, to estimate the impact of taxes over gross domestic product (GDP) per capita. The econometric results show a negative and statistically significant impact of the overall tax burden over per capita GDP. In average, an increase of 1 percent in the overall tax burden decreases GDP per capita by 0.3 percent. This result is very similar in magnitude with those presented by Heady et al. (2011). Furthermore, additional econometric results pointed out that a revenue neutral fiscal policy which changes the tax structure toward consumption taxes and personal income taxes would improve economic growth. Besides that, we strongly recommend against both taxes over the capital stock (mainly the recurrent ones) and the corporate income taxes.

In this article we estimate the relationship between inflation and trade openness [e.g., Romer (1993)] using modern panel data techniques. The advantage here is that we are able to explicit test the hypothesis proposed by Terra (1998) that the negative relationship between openness and inflation is due to severely indebted countries in the debt crisis period. The econometric results give support to Romer (1993) showing that the negative relationship between inflation and openness are neither restrict to a subset of countries or a time period.

Based on the relation between investment and domestic saving proposed by Feldstein and Horioka (1980) to verify capital mobility, this study performs some exogeneity tests in order to determine the capacity of the FH equation of supporting and implementing economic policies in Brazil. We then use the result of weak exogeneity test to identify a structural vector autoregressive (SVAR) involving investment and saving in order to evaluate the effect of exogenous shocks through impulse response functions (IRFs) on both variables. The main findings of this paper are: a) the elasticity of domestic saving estimated using appropriate methods points out to high capital mobility for Brazil; b) domestic saving is weakly exogenous in the FH equation; c) domestic saving is not strongly exogenous, therefore this equation should not be used to make forecasts for the Brazilian economy; d) superexogeneity is accepted for domestic saving, meaning that Lucas' criticism does not apply; and e) the IRFs showed that investment is sensitive to contemporaneous innovation on saving and this effect lasts for a long time. Regarding to domestic saving, the response of this variable to a non-expected shock on investment has a more is more complicate description. Initially domestic saving goes down. After some lags this movement changes and domestic saving begins to react positively to the shock.