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

During the period spanning independence in 1822 to mid-century, Brazil's southeast shifted from specialising in the export of cane sugar to coffee. This paper 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. I argue 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 United States. I estimate that American tariff reform served to increase coffee exports and African slave imports by around one-fifth. American firms, with indirect links to the slave trade, rapidly became major players in the export market in Rio de Janeiro, while non-American firms, traditionally specialised in Continental European destinations, turned their sights on the American market.