Co-evolution of industry strategies and government policies: The case of the Brazilian automotive industry

Abstract

This study examines the evolution of the automotive industry in Brazil and its key drivers. We argue that the rules of the game - industry policies - are an outcome of exchanges between the host government and industry. These arise from changes in economic and political environments and interdependence between industry and the country's economy. To this end, we draw upon literature on institutions and co-evolution to understand the industry footprint over a 50-year period, as well as its relationship with changes in government policies. This study generates new insights on institutional and co-evolution political perspectives by showing that the rules of the game are not only the making of the government, but are also the result of interdependencies between industry and government.