The relationship between industrialization and agricultural exports in Brazil following World War II has been extensively analyzed by Furtado, Huddle, Fishlow, and Malan et al.' The discussion centers on the impact of the antiagricultural bias, enforced through exchange-rate controls, on the level and rate of growth of the economy. According to Furtado, the expansion of real output in the postwar years was due to the exchange-rate policy and to selective import controls. From his point of view, the fixed exchange rate, coupled with quantitative restrictions-which restructured the import list in favor of intermediate and capital goods-held down the cost of equipment in relation to the prices of domestically produced manufactures. The subsequent rise in industrial profits stimulated investment in the manufacturing sector. Huddle, on the contrary, considers the exchange-rate policy and the quantitative import restrictions to have lowered both the rate of investment and the growth rate of output. His argument, founded on estimates that indicate extremely slow economic growth, can be partly refuted on the basis of more recently available data that confirm Furtado's initial calculations (see table 1). Huddle also contends that import liberalization, coupled with exchange-rate devaluations, would have been a better policy alternative, given the problems facing the country after the war.