"How can policies improve the welfare of people in economically lagging regions of countries? Should policies help jobs follow people? Or should they enable people to follow jobs? In most countries, market forces have encouraged the geographic concentration of people and economic activEities -...

This paper describes how different policy distortions have been impeding better integration of Brazil's external and internal product markets and discusses how these distortions have prevented domestic firms from benefiting from multiple sources of efficiency gains. The paper first focuses on...