Structural Change, Catching Up and Falling Behind in the BRICS : A Comparative Analysis Based on Trade Pattern and Thirlwall's Law

The BRICS (Brazil, Russia, India, China and South Africa) have gradually become more than an acronym as their governments have been engaging in international and political negotiations as if they were a regional economic group. The main goal of this paper is to compare the structural change of the BRICS using econometric evidence based on estimates of Thirlwall's law for the period 1995-2013. Thirlwall's equations have become powerful indicators to evaluate whether a country is in a catching-up or falling-behind long-term path. Our basic assumption is that the way in which each country engages in international trade and global capital flows affects, positively or negatively, structural change and the catch-up trajectory. Though our results cannot confirm Russia's long-term growth trajectory, they do confirm that over the period analysed China and India have shown a rapid catching up path, while Brazil and South Africa have entered into a falling behind path