#1ANNUAL REPORT 74TH EDITION | 2018 FGV#2ANNUAL REPORT 74TH EDITION | 2018 FGV#3CONTENTS 04 Access the Annual Report page on FGV's website using the QR Code reader on your phone Letters from the President and Vice President 10 52 Applied Research Projects Highlights FGV in 2018 104 International 112 Organizational Structure 116 Financial Statements#4LETTERS FROM THE PRESIDENT AND VICE PRESIDENT#5Carlos Ivan Simonsen Leal Carlos Ivan Simonsen Leal President of Fundação Getulio Vargas A YEAR OF CHALLENGES FOR DEVELOPMENT T The year 2018 marks an interesting and challenging point in Brazilian his- tory: after 30 years, the economic model that underpinned the social democracy framework established with the 1988 Constitution appears to be exhausting itself. The reasons are both internal and external. Internally, the introduction of the Real from 1994 onwards and successive interventions to control inflation, which brought it to a historically low level, were accom- panied by rising unemployment to levels not previously observed. Externally, the country has witnessed, in recent years, a decline in the added value of its exports. Despite the size of its GDP, the country has a small percentage of international trade. Deep challenges lie ahead of Brazil so that it can develop both from the standpoint of economic growth and from that of social justice. Willingness to do it alone is not enough. It takes the ability to undertake. It means knowing where to add value, in what and how to invest, what to stimulate, and what to discourage. Discussions swarm all places, often based on lack of information and a rational analysis of our real possibilities and priorities. Willingness to do it alone is not enough. It takes the ability to undertake. It means knowing where to add value, There was a time when talking about planning fell into disuse. Later on, the importance of planning was again mentioned, but the actual ability to do so had been reduced. FGV, in its mission to stimulate Bra- zilian socioeconomic development, has turned increas- ingly in the last years to face the challenge of national leverage. The year 2018 was especially fortunate in that sense. We have been able to increase the quantity and focus of our actions. We provide education for tens of thousands of people and for millions on the Internet. Our applied research, which is intended for the res- olution of the practical problems of everyday life, has increased its volume even more. Scientific rig- or and ethics were essential pillars for this reality. The year 2018, in addition to the two years that preceded it, is part of the cycle of adjust- ment to the new economic realities and prepa- ration for the future. For our work, we reached the position of the world's 6th best think tank, according to the University of Pennsylvania's in what and how to invest, what to stimulate, and what to discourage. Global Go To Think Thank Index. Once again, we also ranked first in the aca- demic assessments of the Brazilian Ministry of Education (MEC). All this is the result of permanent commitment to Brazil. 6 Annual Report 2018 7 LETTER FROM THE PRESIDENT#68 Sergio Franklin Quintella Vice President of Fundação Getulio Vargas CONTRIBUTIONS TO NATIONAL DEVELOPMENT Sergio Franklin Quintella The year 2018 was also very fruitful in FGV's participation in seminars abroad and in the promotion of debates. T The year 2018 was a difficult year for the Brazilian economy, with re- percussions in the area of education. Educational institutions, such as FGV, were affected in some way by the difficulties of the economy. The Foundation, however, has maintained its leading positions. All of its Law, Ad- ministration, Economics and Mathematics schools, in Rio de Janeiro and Sao Paulo, from the academic standpoint, have achieved first place or outstanding positions in the Education rankings. This is the result of a correct strategic vision and the continuous effort of teachers and students. One highlight of this leading position is the success of the Foundation, through the IDE (Institute for Educational Development), which, through its nu- clei in Rio de Janeiro, Sao Paulo and Brasilia, as well as through its group of af- filiates, worked intensively in the area of executive education, distributed across Brazil, with several thousands of students in the lato sensu graduate courses. The new fact was the insertion of FGV in the context of primary and sec- ondary education. Our goal was to meet the needs of the areas of content management and transmission in the classroom, observed in these two seg- ments of public and private education networks, which are reflected in the undergraduate and graduate levels. Several agreements with states and mu- nicipalities were signed to initiate the training of teachers and deans through distance education - after all, it would be impossible to provide all this training in person. The performance in basic education is a new face of FGV, which for many years has specialized in higher education in Economics, Administration, Law, Mathematics, and Social Sciences. Another innovation is the expansion of FGV's activity in the international field, with the opening of an office in Cologne, Germany, aiming at providing services to international companies. This initiative will also favor the capture of investments from foreign companies in Brazil. FGV's arm abroad may become another source of revenue for the country. The year 2018 was also very fruitful in FGV's participation in seminars abroad and in the promotion of debates in the Foundation's units on topics relevant to the future of Brazil. The Foundation brought together the public, ministers of state, ministers of higher courts, governors, company presidents, deputies, senators and mayors to discuss issues related to national develop- ment in meetings open to public participation. Several debates were held, without any political-partisan connotation, with extremely positive results. The year 2018 was, therefore, quite profitable. We were able to maintain our high quality of teaching and projects, advance in the degree of interna- tionalization, and increase our collaboration to qualify the debate of issues of extreme importance for the country's development. Annual Report 2018 9 LETTER FROM THE VICE PRESIDENT#7APPLIED RESEARCH PROJECTS HIGHLIGHTS AVISO IMPORTANTE ARCATIUNT THROSAR In order to fulfill its mission, which is to promote the stimulus to national socioeconomic development, FGV develops several academic texts every year, which serve as the basis for public debates between researchers and representatives of the public and private sectors. Among this extensive intellectual production, 19 applied research projects selected by FGV's Research and Innovation Committee stood out, thanks to the relevance of their contribution to the advancement of social sciences and their impact on society.#8Administration DETERMINING FACTORS OF SMALL CHANGE DONATION BY RETAIL CONSUMERS AND ITS IMPACTS ON SOCIAL DEVELOPMENT By allowing customers to donate the small change from their purchases to socio-environmental causes, retail stores can be a major ally in disseminating the culture of donation in Brazil. To understand more deeply what prompts consumers to donate their small change from retail purchases, a survey was conducted among customers of 42 stores of the Minuto Pão de Açúcar chain. OBJECTIVE • To evaluate a pioneering proposal in Brazil for integration between retail stores and the third sector to raise funds for social development by voluntary contributions from consumers. The focus is on the customers of retail stores who choose to donate their small change, by rounding up the amount paid. RESEARCH METHOD • The methodological-conceptual structure of the Transformative Consumer Research (TCR) movement was adopted, which encourages the conduction of studies that ben- efit the quality of life affected by consumption. The study was carried out in three phases. 1. 2. 3. Quantitative - An online survey was conducted among 1,449 customers of 42 stores of the Minuto Pão de Açúcar chain. Quantitative data were collected about demo- graphic factors and attitudinal factors that can affect the process of donation. Quantitative - A field experiment was conducted lasting one month at the 42 stores, using data on purchases and donations by customers. Quantitative data were collected on the situational factors that can affect the donation process. Qualitative Three focus groups composed of Minuto Pão de Açúcar customers who had experienced the small change donation project were formed. The first group consisted of regular (engaged) donors, the second of occasional donors and the third of rare and non-donors. Qualitative data were collected from the focus groups that helped to understand how the situational, demographic and attitudinal factors affect the donation process The quantitative analyses were carried out via binary logistic regression, hierarchical cluster analysis and analysis of variance. RESULTS • The study showed that situational factors and attitudinal factors have the greatest influence on the behavior of retail store consumers to donate their small change to support socio-environmental actions. The most relevant situational factors for micro-donation were: highest total amount of the purchase; lowest change amount; and high engagement of the store/cashier. The most relevant attitudinal factors for micro-donation were: previous disposi- tion of the consumer to help others; positive prior perception of the consumer about the work of NGOs; and previous intention of the consumer to donate when opportunities appeared. Three donor profiles were noted among the respondents: (1) engaged (less suscep- tible to the influence of situational factors), (2) occasional (more susceptible to the influence of situational factors); and (3) rare and non-donors (influenced by situational factors in more specific circumstances, such as if the amount of the change represents a tiny portion of the total value of the purchase). They did not differ in demographic terms, but did in terms of attitude and behavior. Engaged and occasional donors were clearly more altruistic than rare and non-donors. However, consumers with all the pro- files expressed concern with improving education. The main challenge for success of the project is to make the customers understand how the micro-donation system functions at retail shops and to obtain their adherence for the first time. For this purpose, it is important to involve the store staff, to provide customers with information before their arrival at the store and to supply details about the project in non-invasive form, with stress on transparency. CONTRIBUTIONS OF THE STUDY The "donation of small change at retail stores" model is groundbreaking in Brazil. It offers a rich possibility for interface between private companies and the third sector, through involvement of consumers as protagonists of the process. The project covers some theoretical gaps in the literature: the influence of the amount of the donation in the propensity to donate; the role of gender in donation behavior; the influence of brand familiarity in the decision process of potential donors; and the influence on customers' behavior of the engagement of store staff with the social re- sponsibility program. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY • The model tested in the study can serve as a reference for organizational initiatives that share the objective of promoting social development in Brazil, strengthen the institutional image of the participating companies and generate funds for the projects of social organizations. The money received from the micro-donation can promote the work of social organi- zations and benefit the people helped by them, enabling the financial stability neces- sary to continue current initiatives and promote new ones. Decision-makers of retail companies and social organizations can use the results of the project and the discussions raised by it as support for decisions that promote real social impacts, such as improving the living conditions of needy Brazilians. AUTHOR: Tânia Veludo-de-Oliveira. RESEARCHERS: Edgard Barki and Felipe Zambaldi. ORGANIZATION: Sao Paulo School of Business Administration (EAESP). SUPPORT: Center for Excellence in Retailing (FGVcev), Center for Entrepreneurship and New Busi- nesses (FGVcenn), and Applied Research Fund (FPA FGV), all of Fundação Getulio Var- gas, and Sao Paulo State Research Support Foundation (FAPESP). 12 Annual Report 2018 13 RESEARCH#9Economics The inclusion of controls for company (firm fixed effects) accounts for a large part of the unequal pay between genders. . Unequal pay due to gender increases with rising educational level. EDUCATION, LIFE CYCLE AND GENDER INEQUALITY IN THE FORMAL BRAZILIAN LABOR MARKET Although gender inequality in pay has declined over the generations in Brazil, it increases over the life cycle of workers and also with their educational level. For all schooling levels, even after controlling for all the observable characteristics, the remaining gender inequality is between 10% and 20% during the worker life cycle. CONTRIBUTIONS OF THE STUDY • • The results are groundbreaking in the Brazilian literature. The study explores in longitudinal form data on firms and workers in Brazil from the RAIS. The latest modes of analysis about the evolution of gender differences were applied in the Brazilian case, indicating a decline of inequality from 1994 to 2014. Although the focus is on the question of differences among workers due to gender, the study reveals, in a context of lifecycle with multivariate models and long-run longitudinal data, the importance of the firm effect on wage inequality in the formal Brazilian labor market. This was twice as important as formal education and other individual character- istics, for example. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY • • The study was described in a news story on TV, expanding the diffusion of the knowledge in society. The study was presented at the table of the Inter-American Development Bank (IDB) at the 45th National Economic Meeting (ANPEC). The study is the most comprehensive analysis of Brazilian inequality in comparison with other countries analyzed by the United Nations (UN). The results have been presented at various events abroad. OBJECTIVE To study the pattern of gender inequality over time and during workers' life cycle, using data that connect employers and employees with different schooling levels in the formal job market in Brazil. RESEARCH METHOD • Longitudinal data corresponding to employer-employee were extracted from the doc- ument called Annual Report of Social Information (RAIS), based on reports by firms to Brazil's Ministry of Labor from 1994 to 2015. An econometric model was estimated that considers a specific set of workers divided into three educational levels. The focus is to estimate the pattern of wage gender inequal- ity during the two decades after leaving school. The model was expanded to include controls for the specific effects of employment; to evaluate the effect of occupation/sector and firm characteristics; and also to include controls for specific firm effects. RESULTS • Inequality in pay by gender has decreased over the generations when comparing workers of different ages. Gender inequality in pay increases during the life cycle of the same cohort until 40 years of age, when it starts to decline until retirement. 1 The specific characteristics of each firm explain, in large part, the wage inequalities in the formal sector. AUTHOR: Marcelo Neri. RESEARCHERS: Cecília Machado and Valdemar Neto. ORGANIZATION: Center for Social Policy (Social) and EPGE Brazilian School of Economics and Finance (EPGE). 14 Annual Report 2018 15 RESEARCH#10Economics COST FUNCTION OF THE ELECTRICITY DEFICIT The cost of the electricity deficit is one of the most important aspects for planning expansion and operation of the Brazilian electric power system. This project tested methodological improvements able to better reflect the real impact of electricity shortage considering the heterogeneity of consumers in various deficit scenarios. OBJECTIVE • The deficit cost represents the maximum value that can be attributed to a new project able to avoid shortage of electricity, or more generally, the economic cost of shortage or lack of availability of electric power. Considering the relevance of the deficit cost to the Brazilian electricity system and the outmoded method for calculating costs used now, the aim of the project was to pro- pose and test methodological improvements able to better reflect the true impact of power shortage. RESEARCH METHOD 1. To attain the expected results, the project was divided into six steps: 2. 3. 4. 5. 6. Updating of the model currently used, proposed by the Electric System Planning Co- ordination Group in 1988. The model was updated with more recent data on the sys- tem in Brazil's national accounts (input-output matrix for 2010 and table of resources and uses for 2013), also including changes in electricity tariffs and in the system to obtain the sectorial costs. Calculation of the deficit cost applying a computable general equilibrium model. Although representing reality in very simplified way, the model is extremely trac- table and presents highly robust results (results adherent to actual data on the Brazilian economy). Conduction of a direct survey of end consumers of electricity, including residential, commercial and industrial consumers, to investigate the perception of different con- sumer classes about the socioeconomic costs of energy possible rationing. The ob- jective was to discover the monetary value that would have a similar (or compensa- tory) effect on the welfare of consumers in general. Proposal of a methodology to estimate the implicit deficit cost. Evaluation of the proposed methods. Comparison criteria were defined to evaluate the proposed methods, considering the difference between models and measuring the main characteristics and fragilities of each one: representativeness of social costs, premises, robustness (stability), reproducibility and complexity. Each model was able to better reflect a specific need. Estimation of the effects of the deficit cost functions proposed in the computational models for the electric power sector (NEWAVE). RESULTS . Besides updates of the current methodology, alternative models were developed, eval- uated and estimated, in line with the state of the art in the literature and international practices. Among the models that were adapted to Brazilian reality, the standout was the approach using surveys among consumers to estimate the value attributed by different groups to the consumption of electricity, and as a consequence, to the effects of possible shortage. Irrespective of the method chosen, good governance in operation of the electric system is vital. The models and methods to calculate the cost of the deficit should be transparent and the operation of the system should be consistent with the dynamic optimization processes, to effectively reflect the targets and needs of that operation. CONTRIBUTIONS OF THE STUDY • The study offers and tests methodological improvements able to better reflect the true impact of possible shortage of electricity, considering the heterogeneity of con- sumers and various deficit scenarios. Besides using and improving the current method of calculating the deficit cost, an in- ternationally recognized approach, not previously employed in Brazil, was developed, characterizing the innovation of the research project - direct research/contingent val- uation. The implementation of a computable general equilibrium model for the prob- lem also is an innovative application in the Brazilian electric sector. The study incorporates the use of complementary methods, including the one cur- rently applied in Brazil, which is based on an input-output matrix and the country's national accounts system. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY The results presented will allow improving the economic signs necessary for planning the operation and expansion of the electricity system. They can also offer support for a possible policy of managing cutoffs in case of a crisis and the development of regu- latory and contractual mechanisms able to improve the allocation of energy resources in moments of shortage, with gains for the economy as a whole. AUTHOR: Joisa Campanher Dutra. RESEARCHERS: Cezar Santos, Claudio Considera, Denise Teixeira, Edmilson Varejão, Edson Gonçalves, Gustavo Timponi, Jimmy Medeiros, Leontina Pinto, Luana Pimentel, Márcio Grijó, Patricia Naccache, Raquel Soares, Vinícius Botelho and Vivian Figer. ORGANIZATION: Center for Regulation and Infrastructure Studies (CERI). SUPPORT: Campos Novos Energia S.A. (ENERCAN), Energética Barra Grande S.A. (BAESA), Companhia Energética de São Paulo (CESP), Itiquira Energética S.A. (ITISA), Energética Águas da Pedra S.A. (EAPSA), Candeias Energia S.A., Companhia Energética Manauara S.A., Foz do Chapecó Energia S.A., Companhia Paranaense de Energia (COPEL), Petrobras, Companhia Energética Rio das Antas (CERAN), Companhia Energética de Minas Gerais (CEMIG), Geração e Transmissão S.A., CEMIG Distribuição S.A., Duke Energy International Geração Paranapanema S.A., Centrais Elétricas da Paraíba (EPASA), Companhia Paulista de Força e Luz (CPFL Paulista), CPFL Piratininga, CPFL Jaguari, CPFL Sul Paulista, CPFL Mococa, Rio Grande Energia (RGE), ELEKTRO and Santo Antônio Energia, Narandiba - Grupo Neoenergia. - 16 Annual Report 2018 17 RESEARCH#11Economics CONSERVATION OF NATURE AND THE REACH OF THE STATE: EVIDENCE FROM NATIONAL FRONTIERS IN THE AMAZON Preservation of natural ecosystems in developing countries is a challenge. Because wilderness ecosystems are in remote location, the exercise of governmental control is hard. This study explores the degree to which the state can exert regulatory control over these remote wilderness areas by examining whether there are discrete changes in deforestation at the Brazilian international border in the Amazon region. OBJECTIVE • The aim is to investigate the reach of the State's power to impose conservation policies in remote areas, by evaluating data on forest clearance in regions around international borders in the Amazon. RESEARCH METHOD . • The analysis considered the entire Amazon region, according to the definition of the Amazon Network for Georeferenced Socio-environmental Information (RAISG), taking into consideration the limits of the biome and the "Legal Amazon" as defined by various countries in the region. A new dataset from Landsat 7, with annual resolution of 30 meters, was used to study the impact of the national policy on the Amazon by monitoring deforestation consistently over time (2000 to 2014) and space. The high resolution of these images allowed magnifying them in areas near the borders (the preferred specification uses a strip with width of 17 km on both sides of the border) to identify effects precisely. Spatial regression discontinuity (RD) designs were employed, using as variable the dis- tance to the Brazilian border, for forests where: (i) the portion of capital in production is low; (ii) the local supply of capital is probably elastic; and (iii) the basic production factor (land) is fixed in space, so the discontinuity in the regression would probably reveal the impact of the conservation policy, and the direct effects tended to predominate. Annual deforestation rates on both sides of the border were plotted between 2001 and 2014 and RD models were estimated separately for each year. 3. strengthened in 2006 by the Law on Management of Public Forests and the entry into operation of the Center for Environmental Monitoring, which together allowed the Brazilian State to combine detection of deforestation with police and military operations where illegal deforestation was detected. The legal restrictions on land use on the Brazilian side of the border made a differ- ence during the period studied. The areas designated as protected in Brazil always were less deforested than unprotected areas on the other side of the border, and this continued to be case form 2006 onward. The Brazilian State was therefore able to apply the environmental regulations when there was a desire to do so even in these peripheral areas. Combined, these results demonstrate a notable reach of the Brazilian State. They suggest that the accelerated deforestation in the Brazilian Amazon was partially was a conse- quence of lax enforcement of laws prior to the mid-2000s, and conversely, that the pre- cipitous decline in deforestation seen since the mid-2000s is the consequence of better monitoring and tighter enforcement. CONTRIBUTIONS OF THE STUDY • Using satellite images with fine resolution, the study tested whether Brazilian conserva- tion policies have had an effect along the nation's borders. This is an interesting exercise, because there is considerable skepticism in relation to the capability of the State to exer- cise control over remote regions. Indeed, the capability of the State to preserve ecosystems can decline as the areas be- come more remote, which opens opportunities to extract resources illegally. Given that the rapid environmental degradation in developing countries is being driven by illegal extraction, it is important to asses empirically whether or not the State has the power to conserve natural resources in these remote places. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY The fact that the deforestation rate in Brazil went from a maximum in 2004 to a minimum in 2009 bears witness that weak preservation policies can be strengthened. Part of this turnaround was achieved because the Brazilian State combined stricter environmental regulation with the use of satellite data in an integrated system involving various govern- mental entities: Brazilian Institute of the Environment and Renewable Natural Resources (IBAMA), Federal Police and the Army, among others. The success of wilderness conservation, therefore, ultimately depends on the policy choices of national governments. Information on illegal logging, for example, is regularly available to any government. The noteworthy reversion documented in the Brazilian Am- azon suggests it is possible to reduce deforestation and environmental degradation even in wild areas with difficult access in developing countries. RESULTS 1. The study documented three noteworthy facts: 2. Until 2005, the level and rate of deforestation were dramatically higher on the Bra- zilian side of the border than on the other side. In the starting year, 2000, Brazilian areas were about 30% more likely to be cleared than similar areas located nearby in neighboring countries. And from 2001 to 2005 the annual deforestation rate was three times higher on the Brazilian side of the border. The discontinuity in the deforestation rates fell abruptly in 2006 - when Brazil started to implement substantially stricter national policies to fight illegal deforestation. - as part of the Action Plan to Prevent and Control Deforestation in the Legal Amazon (PPCDAM), which increased the penalties for illegal deforestation, especially in un- claimed lands and private lands outside formally protected areas. The PPCDAM was 18 AUTHOR: Francisco J. M. da Costa. RESEARCHERS: Benjamin Olken and Robin Burgess. ORGANIZATION: EPGE Brazilian School of Economics and Finance (EPGE). SUPPORT: European Research Council. Annual Report 2018 19 RESEARCH#12Economics One of the objectives of the technical courses identified is to prepare students for entry into college programs. However, in the samples used to evaluate the impact, we did not find significant differences between regular secondary school and technical courses re- garding the probability to access higher education. • High dropout rates were observed. STUDY OF SECONDARY SCHOOL PROGRAMS ARTICULATED WITH TECHNICAL EDUCATION IN THE STATE OF SANTA CATARINA The study of the multiple sources of technical education in the state of Santa Catarina found a mismatch between the skills taught in the courses offered and the needs of employers for specific job qualifications. It also revealed the importance of technical education to help develop the socio-emotional skills of young people. OBJECTIVE • To evaluate and improve the school-to-work transition of young people in the state of Santa Catarina, by mapping and analyzing the multiple sources of technical education and the needs of employers. . For the technical courses of the National Program for Access to Technical Teaching and Employment (PRONATEC) offered by SENAI, the impact assessments suggest that the program has had a positive and significant impact on the average wage of the students, with the effect being stronger on female than male students. The evaluation of the impact considering socio-emotional skills presented a statistically significant effect in three com- petencies: amiability, extroversion and locus of control. For the technical courses offered by basic education schools, the impact evaluations suggest the existence of a positive effect on the probabilities of moving to another city to work and of being employed. There are strong indications of a mismatch between professional courses and the jobs found by the alumni, identified in the data from the Annual Report of Social Information (RAIS). Besides this, the results indicate that workers with an occupation related to the technical course completed earn higher pay than those who work in other professions. CONTRIBUTIONS OF THE STUDY • One of the main results is the importance of technical education to help develop so- cio-emotional skills in young people. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY At present, the Santa Catarina State Secretariat of Education is conducting a new project to introduce a module to develop socio-emotional skills in the curriculum of the state technical school system. RESEARCH METHOD • • Review of the national and international literature on technical education and analysis of the teaching experiences in Brazil, with emphasis on those that include socio-emotional development of students in the curriculum. Mapping and characterization of the skills required by the labor market in the state of Santa Catarina and the secondary school programs articulated with technical education offered by the Santa Catarina State Secretariat of Education, Santa Catarina State Fed- eration of Industries (FIESC). Analysis of the strategies for monitoring and evaluating these programs, by interviews with key actors of the institutions offering these programs. Cost-benefit evaluation of the technical education programs in the state of Santa Catarina. Quantitative evaluation of the impact of technical education programs in the state on job market outcomes of the people participating in these programs. The evaluation method was defined per program, taking into consideration the criterion for selecting beneficia- ries and the available data, crucial to define the most appropriate method to identify the control group. RESULTS The results suggest that it is possible to improve the efficiency of schools in training stu- dents by identifying practices adopted by more efficient ones and implementing them in less efficient schools that have similar characteristics. There are some skill areas where it is hard to recruit instructors, due to a shortage of pro- fessionals with specific training in the market. AUTHOR: André Portela. RESEARCHERS: Aline D'Angelo, Amanda Arabage, Bernardo Modenesi, Cláudia Oshiro, Dalila Figueiredo, Juliana Camargo, Karina Bugarin, Lya Porto, Lycia Lima, Sammara Soares, Tatiana San- dim and Victor Matos. ORGANIZATION: Center for Microeconomic Studies (C-Micro) of the Sao Paulo School of Economics (EESP). SUPPORT: Inter-American Development Bank (IDB), Santa Catarina State Federation of Industries (FIESC), Santa Catarina State Secretariat of Education, National Industrial Learning Ser- vice (SENAI) of Chapecó, Xanxere, Itapiranga and São Miguel do Oeste. 20 Annual Report 2018 21 RESEARCH#13Economics THE POLITICAL ECONOMY OF CONSUMER CONFIDENCE IN BRAZIL The analysis of date from the period from September 2005 to October 2016 confirms that the confidence of Brazilian consumers reacts to fluctuations in macroeconomic variables like the exchange rate and unemployment rate, and is also influenced by economic uncertainty and the tone of media coverage. However, electoral cycles and political scandals appear not to affect Brazilians' confidence in the economy. Curiously, neither electoral cycles nor political scandals appeared to be relevant to Brazil- ian consumers in the period analyzed. A possible reason for this is the fact that there was no alternation of political parties during the period studied. The elections mattered to the extent they portended unfore- seen political and economic changes, and in this sense it is not surprising that the conti- nuity did not lead to changes in confidence. On the other hand, it is somewhat surprising that political scandals did not have an effect on confidence, since it is natural to assume they are related to political uncertainty that will affect the future performance of the economy. CONTRIBUTIONS OF THE STUDY • There are no studies published in the main academic periodicals on the confidence of consumers in emerging economies. The study helps to fill this gap in the literature by examining how political and economic factors, both domestic and international, along with the tone of economic news in the media, contribute to explain consumers' confi- dence in Brazil. OBJECTIVE • • To study the political and economic factors that influence consumer confidence and to contribute to the development of governmental actions to strengthen this confidence. RESEARCH METHOD • The project analyzed the monthly values of the Index of Consumer Confidence (ICC) pro- duced by FGV IBRE in the period from September 2005 to October 2016. The study contemplated the usual macroeconomic aggregates included in the literature, as well as exogenous economic shocks, political events and the tone of media coverage of the economy. The starting point was standard error correction models to investigate the short- and long-run influences of the explanatory variables on the confidence level of consumers. Considering the potential endogeneity between the series, we also used vector error cor- rection models (VECMS), in this case only for monthly changes in sentiment. Each of these models was applied using four different specifications: 1. Domestic macroeconomic variables (gross domestic product - GDP, unemployment, inflation, income, interest rates and exchange rate); 2. Variables that can capture the optimism associated with coming elections, as well as the expectations that can follow them, in the periods from 1 to 6 months before and after elections, and the honeymoon effect during the first six months of the presi- dential term; A variable denoting economic uncertainty; 3. 4. A variable representing the impact of the international scenario. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY • To develop a method to study the political economy of confidence that can be used by other centers, particularly in Latin America, that produce (or have the potential to pro- duce) similar indexes. We are working on alternative specifications for the model, especially to identify a vari- able to represent political scandals that can reflect Brazilian reality more precisely that that adopted so far. In this respect, we are working to improve the measures with the aim of more accurately capturing the effects of the political instability that marked the period studied and its effects on consumers' confidence. RESULTS . As expected, economic conditions had a long-term influence on consumer confidence. It increased with economic growth and decreased with higher interest rates and weaker exchange rates. These effects were observed both in the short and long terms, and in all the specifications. The results also revealed the impact of economic uncertainty and media coverage on consumer sentiment. The negative impacts of inflation and unemployment were significant only in the short term, while income was never significant at the standard levels. Inflation was significant in some models, but lost explanatory power in the presence of media coverage of the economy. Economic uncertainty had a negative effect on confidence both in the short and long runs. Positive media coverage of the economy (inflation and unemployment) strengthened confidence, suggesting that part of the effect of economic variables is channeled through the perceptions created by media reporting about the economy. 22 AUTHORS: Aloisio Campelo and Daniela Campello. RESEARCHERS: Fernando Ormonde Teixeira and Viviane Seda Bittencourt. ORGANIZATION: Brazilian Institute of Economics (IBRE) and Brazilian School of Public and Business Administration (EBAPE). SUPPORT: Applied Research Fund (FPA FGV). Annual Report 2018 23 RESEARCH#14Economics EVALUATION OF THE LEGO ZOOM LEARNING PROGRAM A randomized experiment conducted in the city of Recife with third and fifth grade students found considerable short-term effects of using Lego construction blocks along with theoretical curriculum content on cognitive measures - greater for younger children. This evidence supports the conclusion in the literature that cognitive skills are more malleable at younger ages. OBJECTIVE . To evaluate the process of developing cognitive and non-cognitive skills of primary school students. RESEARCH METHOD . • • An intervention is being carried out that combines activities using Lego building blocks with the basic school curriculum. During the activities, the students are divided into groups and need to assume specific roles in their group. The activities combine that curriculum content (such as concepts of mathematics, science, etc.) and also help the students to develop cognitive skills (such as reasoning and problem solving) and so- cio-emotional competencies (such as leadership, extroversion, etc.). The schools that participate in the program receive Lego kits with specific instructions for teachers and students. The teachers also receive training to implement these activi- ties. In each classroom the students perform the activities with the Lego blocks (30 min- ute session) during the regular school day, so it is not an extracurricular activity. At the start of 2014, 30 municipal primary schools (from a total of 171) were selected at random to participate in the evaluation. The sample thus represented the universe of municipal schools in Recife, since the characteristics of the chosen schools did not differ from those of the rest of the city's schools - they all had similar infrastructure, size, teach- er characteristics and student proficiency. The schools were stratified by geographic location, creating pairs based on distance. For each pair of schools, one was chosen at random to participate in the program and the other to act as a control. Data were collected in two rounds - baseline (before the program) and at the end of the school year - regarding third and fifth grade students at the 30 schools selected (15 participants and 15 in the control group), about socio-emotional components and five cognitive skills: logical-verbal reasoning, abstract reasoning, spatial reasoning, numerical reasoning and logical reasoning. Data were also gathered from the results of the examination administered by Pernam- buco State Education Secretariat - SAEPE (scores on the mathematics and language proficiency tests and school administrative information). The field work to collect the baseline data was performed in July and the monitoring of the SAEPE examination was performed in December the same year. The program was implemented in August in the participating schools, and the impact was estimated six months after implementation. Two different assessments were carried out, to capture the cognitive and non-cogni- tive. For cognitive skills, five tests were administered with questions to capture the log- ical-verbal, abstract, spatial, numerical and logical dimensions. The impact of the pro- gram was evaluated for each of the five cognitive tests and the average score on all the tests was computed. To measure the socio-emotional competencies, the SENNA (Social and Emotional or Non-cognitive Nationwide Assessment) was used, an instrument developed by the Ayr- ton Senna Institute'. All told, data were collected from 1,877 students in the two rounds (baseline and fol- low-up), along with the socio-emotional scores of 1,008 students that participated in the two rounds. The sample of students that took the cognitive tests in both rounds (full sample), baseline and follow-up, corresponded to 54% of the students who were enrolled in the third and fifth grades of the schools analyzed at the start of 2014. RESULTS • There was a positive impact of the program using the building blocks on the cognitive skills of the youngest students (7 and 8 years old), but no robust effect on older children (10 to 12 years old). Complementarity was found between the socio-emotional competencies and the devel- opment of cognitive skills. The children who had the highest prior socio-emotional com- petencies obtained the greatest benefits from the investment (Lego building block pro- gram). This result suggests that the development of socio-emotional competencies can expand the window of opportunity in which the program can affect the cognitive skills. The effects of the treatment were always higher for the third grade students. The data showed a positive and significant effect of the intervention on the average cognitive score and other specific cognitive measures (logical-verbal, logical and abstract). This finding that the effects of the intervention were stronger on third grade than on fifth grade students corroborates the theory that cognitive skills are more malleable at younger ages. The results provide evidence of significant and positive effects on extroversion and open- ness, and a negative and significant effect on emotional stability. The effect on awareness was also negative, but not significant. No robust pattern could be observed for the effect of the Lego intervention on the so- cio-emotional competencies. In contrast to the results for cognitive skills, the effects on the socio-emotional competencies were more important for fifth grade students. The effects of the intervention on all the cognitive skills taken together were not sig- nificant for the third grade students, but all the signs were positive. These results are in agreement with evidence found by other researchers that non-cognitive skills are more malleable during the early years of life cycle. CONTRIBUTIONS OF THE STUDY • This is the first study using a controlled randomized experiment to investigate the impact of a program involving Lego building blocks on cognitive and non-cognitive skills. 1 The Ayrton Senna Institute is a nonprofit organization, founded in November 1994, with the objective of providing opportunities for Brazilian children and youths to develop their potential through high-quality education. Acting in partnership with public school systems, each year the institute benefits 1.5 million chil- dren and youths and trains 45 thousand educators in approximately 600 municipalities in 16 Brazilian states. 24 Annual Report 2018 25 RESEARCH#15Economics APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY The development of non-cognitive skills is important not only because of the well-doc- umented effect of these skills on risky behaviors and labor market outcomes, but also because these skills can increase the return of investments to develop cognitive skills and increase the window of opportunity to change them. A question for future studies is whether this complementarity with non-cognitive skills is a particular characteristic of the Lego building block program or if it can be found in other types of programs and investments in teamwork. In terms of public policies, the project demonstrated that for students with stronger pre- vious socio-emotional competencies the impacts of the Lego program on their academic performance were greater, which attests to the importance of developing socio-emotion- al abilities as a mechanism to diminish educational inequalities in the future. INTERNATIONAL COMPETITION AND ITS EFFECTS IN THE LABOR MARKET In recent decades China has become the world's leading foreign trader (in terms of value). This project studies how the world has responded to this unprecedented development, concluding that the growing participation of China in global trade has generated welfare gains around the world. However, there are winners and losers in different productive sectors. AUTHORS: Cristine Campos de Xavier Pinto and Vladimir Ponczek. RESEARCHERS: Helena Lima and Luis Alvares. ORGANIZATION: Sao Paulo School of Economics (EESP). 26 OBJECTIVE • To provide a general theoretical framework to quantify the impacts of a shock in international trade considering labor market frictions. Gains in welfare arising from China's growing participation in the global market are calculated using nu- merical methods and considering not only the benefits of cheaper Chinese prod- ucts to consumers, but also the potential costs associated with adjustments in the job market. RESEARCH METHOD • A dynamic model of world trade was constructed, including various important as- pects of the impact of trade shocks, namely search frictions, job heterogeneity and labor mobility frictions. Changes in real income per capita resulting from the growing participation of Chi- na in the global market were calculated by numerical methods. These calculations considered not only the benefits, but also the potential costs asssociated with labor market adjustments. RESULTS • • The results generated by the model show that lowering of trade barriers between China and the rest of the world benefits all countries, not only in the new equilibri- um, but also during the transition period. Nevertheless, workers employed in industries with low technology experienced a fall in their real wages and higher unemployment after the ascension of China. In this case, the negative effects generated by greater exposure to Chinese imports outweighed the positive effects of the decline of prices to consumers. The numerical exercise also demonstrates the dynamic effects associated with the rise of China. Immediately after the shock, wages increased in exporting sectors and fell in industries facing fierce import competition from China. As workers shifted from industries strongly affected by Chinese growth in search of better-paid jobs in other sectors, wages started to fall in exporting sectors due to the increased supply of labor. This meant that in such industries, wages were lower in the new equilibrium than during the transition period. In sectors that faced strong competition from Chinese imports, however, the effects were the opposite: wages fell immediately after the shock and recovered over time. CONTRIBUTIONS OF THE STUDY This is the first study to explicitly quantify the effects of a trade shock - the rise of China - by analyzing the following aspects: general equilibrium effects between countries; dynamic adjustment path to a new equilibrium; and adjustment costs of workers between sectors. Annual Report 2018 27 RESEARCH#1628 Administration The main contribution of the study is to supply a tractable framework to structurally quantify the impact of trade shocks in a world with frictions in the search for employment and labor mobility frictions between sectors. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY • The results of the study raise important policyquestions. The first aspect is that facing a strong competitor like China brings benefits to developed and emerging economies, im- plying that any policy that seeks to restrain trade in name of protecting workers should be analyzed carefully. The trade shock, however, generates winners and losers in the labor market. Therefore, it can benefit society to find a way to compensate the losers, while allowing the adjustment to occur without any type of intervention that disrupts trade. Finally, the theoretical framework developed allows studying other questions beyond the scope of this study, such as the exit of the United Kingdom from the European Union (Brexit). INTERNATIONAL COMPETITIVENESS: BUSINESS MANAGEMENT MODELS AND PRACTICES Studies on business productivity in Brazil have been focused on the so-called systemic productivity, highlighting structural problems of the Brazilian economy. This project proposes an analytic framework to chart internal factors that influence firm's competitiveness and evaluate management models and practices that contribute towards the betterment of productivity and performance. OBJECTIVE The objective is to develop an analytical framework to map the firms internal factors that contribute to improve their productivity and performance, in seven Brazilian industrial sectors; also to assess management models and practices that favor this improvement. RESEARCH METHODS 1. The analytical framework was applied to research companies in seven industrial sectors: sugar-ethanol, mining, foods and beverages, chemicals, publishing, telecommunications, and gas systems. The choice of the sectors was aligned to SENAI's priorities. In each sector, 10 firms were studied among those classified in the quartile of the most advanced ones in the sector. The study at the sectorial level adopted the following procedures: 2. 3. 4. Description of the productive chain and identification of the business models existing in each sector. Analysis of the sector evolution and the main factors that influence it. Formulation of a chart with trends in the sector based on secondary information, to permit a prospective analysis of the demands that will define whether or not the firms and sector will maintain its competitiveness. Design of the typical value chain (global or local) of each sector. Interviews were conducted with managers to find evidence of the firms maturity stage in regards to the adoptions of management practices. The interviews also disclosed infor- mation about the professional profiles, targeted by the study. Secondary data comple- mented the information on the firm. AUTHOR: João Paulo Pessoa. ORGANIZATION: Sao Paulo School of Economics (EESP). SUPPORT: Applied Research Fund (FPA FGV) and the São Paulo State Research Support Founda- tion (FAPESP). RESULTS There was strong heterogeneity in the business models analyzed, due to various factors, such as firm size, type of product, final market, position in the production chain and scope of operation (local or international). The business model of the firms did not necessarily determine their management prac- tices, but did influence them. There were companies with different business models that had advanced management practices and good performance. Some of the firms selected had very conservative practices while others were in a very advanced stage. The firms with focus on the external market, exporters or Brazilian multinationals had more advanced management practices than local firms, with focus on the domestic mar- ket. This finding applies also to the subsidiaries of multinationals, which presented more modern management practices. Annual Report 2018 29 RESEARCH#17Administration With respect to the professional profile, the data revealed the need for technical staff and managers to develop specific competencies, such as initiative, proactivity, multifunctional skills, innovative attitude, and the ability to work in teams and to negotiate with partners, customers and suppliers. CONTRIBUTIONS OF THE STUDY • The study was conducted with an original analytic framework, based on the as- sumption that firms define their business model in line with their competitive strategy, and this in turn is influenced by the role the firm plays in global (or local) value chains. CORRUPTION OR INEFFICIENCY: WHICH IS WORSE, AND HOW CAN THEY BE AVOIDED? A laboratory experiment demonstrated that voters overwhelmingly condemn corrupt politicians but often are tolerant of those who only cause waste of public resources. • APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY Based on discussion of the results of the project, SENAI started to review its meth- odological framework, to build scenarios, perform diagnoses and prospect for the training of technicians in various industrial sectors. This discussion can be incorpo- rated by other public institutions engaged in professional training. In 2017 a new project was begun, with a related conceptual framework, involving a network of international researchers led by the China Europe International Business School (CEIBS), on the theme of upgrading strategic capability in emerging markets. AUTHOR: Maria Tereza Leme Fleury. RESEARCHERS: Afonso Fleury, Arnaldo Mauerberg Jr, Claudia Frias, Luis Fernando Oliveira, Mauricio di Mauro and Ruben Bonon. ORGANIZATION: Sao Paulo School of Business Administration (EAESP). SUPPORT: National Council for Scientific and Technological Development (CNPq), National Con- federation of Industry (CNI), National Industrial Training Service (SENAI) and Applied Research Fund of Fundação Getulio Vargas (FPA FGV). OBJECTIVE The aim was to investigate to what extent voters punish corruption and waste in demo- cratic elections. RESEARCH METHOD • The study was included a simulated election game empirically underpinned by an exper- iment. In the election game, two politicians run for office in each electoral district in a majoritarian election, and the winner represents his or her district in the distribution of public funds. Voters decide between two politicians that have greater or lesser ability to "bring home the bacon" from the federal budget to the district. The strictly dominant strategy in the game is that voters always vote for politicians that they believe will bring more money and thus more benefits for each voter. The total amount of federal funds to be distributed is fixed and disputed among four districts with five voters each. The politician better able to bring funds can in this process cause waste (inefficiency) or pocket part of the money (corruption). Thus, the experiment has four treatments: 1. waste; 2. corruption; 3. waste with rule; and 4. corruption with rule. In treatments 3 and 4, the voters, before playing the game, participate in a referendum that determines whether or not a rule will be established against voting for politicians that cause waste (treatment 3) or that divert resources (treatment 4). The participants are informed that, if approved by the majority, the rule will be applied but without any penalty or monitoring. Between the treatments, the amount of money wasted or diverted is the same, which enables distinguishing the effect of corruption from that of waste ceteris paribus. More than this, the amount wasted or diverted is limited, so that the elected politicians of either stripe still bring benefits to their constituents after considering these losses. The politicians were real participants who decided voluntarily to play the role after read- ing the instructions and receiving the complete information on the game. The participants who chose to play the role of candidates decided what type of politician they wanted to be. We adopted this strategy because according to ethical criteria it is not possible to decide at random that a participant will play the role of a corrupt politician. The participants chose their roles voluntarily at the start of the session. All the interactions and roles played were anonymous and the voters did not know who the politicians were. During the game, the politicians did not make any choice. Only the voters had an active role in the voting. Depending on the choice of the voters in each district, the participant playing the role of the politician who was elected gained a fixed salary, plus an amount corresponding to the funds diverted if the politician was corrupt. The game was repeated for ten periods and the participants received information about the number of politicians of each type elected, the quantity of social losses created (by corruption of waste), the gains in their districts and the gains of the elected politicians. 30 Annual Report 2018 31 RESEARCH#18• • The experiment was implemented from November 3 - 6, 2014 in Itajaí (Santa Catari- na), with one session each day. It involved 112 participants in the four sessions, with 28 participants in each one (20 voters and 8 politicians), and each participant took part in only one session. Each session included two treatments, with and without a rule, and the order of im- plementation was reversed to minimize the effects of ordering. The participants were not informed about the content of the second treatment until arriving at this part of the session. The participants were recruited by announcements, e-mails and posters placed in the campus of FGV in the preceding weeks. The composition of the group of participants was very representative of the popula- tion in the region where the experiment was conducted, although there was predomi- nance of participants previously educated in private schools. The participants received a symbolic payment (about eight dollars) and each session lasted about one hour. RESULTS . The results of the study suggest that morality and social rules are indeed crucial in elections with heterogeneous politicians. The results reveal, in the first place, that voters overwhelmingly condemn corrupt pol- iticians, almost totally eliminating their chances of winning, but often tolerate politi- cians who only create waste of public funds. In other words, voters frequently accept politicians that impose the same loss of wel- fare that corruption imposes, but without directly pocketing the public money for their own benefit. Finally, a rule that is accepted by the majority of citizens permits voters to coordinate their actions and encourages them to consider the interests of society as a whole in- stead of just their districts. The rule is able to reduce the number of votes cast for pol- iticians that cause waste even when voting for those candidates would benefit the dis- trict they represent, and hence is a strictly dominant strategy for the individual voter. CONTRIBUTIONS OF THE STUDY . • Unlike previous laboratory experiments investigating corruption by applying bribery games, and that have found little evidence of the moral costs of corruption, the game implemented in this experiment includes the negative externality of corruption in elec- tions and confirms that corruption is strongly punished. Nevertheless, when politicians were described as not being corrupt, but instead likely to cause wasted public resources, nearly half of voters voted for them, resulting in the same loss of welfare as would have been caused by corruption. The supply of infor- mation to voters about the amounts wasted was not sufficient to minimize the lost welfare designed in the game's equilibrium. For this to occur, it is necessary to have a social rule specifying that waste of public funds will not be tolerated. When considered together with the results of voters' deci- sion to adopt a rule against corruption or waste, the results provide support for the hy- pothesis that although voters may reject corruption but tolerate waste, social rules are able to reduce not only corruption, but also inefficiency in representative democracies. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY New studies can help to clarify the effect of political ideology or party identification on the willingness of voters to punish politicians who misbehave, but that are members of the party preferred by the voter, and those of other parties. Future research can also investigate to what extent corruption and waste influence voter turnout in elections. There is evidence that corruption induces voters to participate in elections to prevent parties and candidates associated with corruption from winning. Al- though waste directly benefits neither politicians nor voters, specific individuals or firms can indirectly benefit from it, and in this case it is expected that waste can increase the campaign financing of politicians responsible for it. AUTHORS: Paulo Arvate and Sergio Mittlaender. ORGANIZATION: Sao Paulo School of Business Administration (EAESP). SUPPORT: National Council for Scientific and Technological Development (CNPq) and Max Planck Institute. 32 Annual Report 2018 33 RESEARCH#1934 Economics FAMILY ORGANIZATION AND INCOME INEQUALITY IN BRAZIL The analysis of demographic census data from 1970 to 2010 reveals a pattern of increasing marriage between couples with similar characteristics during this period. The increase of selective marriages, in principle, should not diminish income inequality. Nevertheless, counterfactual exercises reveal that the improved income distribution in this period could have been even greater had this marriage trend not occurred. OBJECTIVE • To investigate the evolution of the marriage market and its impact on income distribution in Brazil. RESEARCH METHOD • • • To verify the number of selective marriages, Brazil's socioeconomic classes were divided into four educational levels - incomplete primary school, complete primary school, com- plete secondary school and university degree - and the Kendall correlation coefficient was estimated between the educational levels of the husband and wife for each census sample studied (1970, 1980, 1991, 2000 and 2010). To verify how the marriage market trend affects income inequality, statistics were ana- lyzed on the income of married people at the different schooling levels. To check whether Brazil's income distribution improved during the period, the GINI index was computed and Lorenz curves were constructed. To examine what would have happened regarding income inequality in Brazil without this marriage market phenomenon, some counterfactual experiments were performed. First, the effect was measured on the GINI index assuming that all marriages had occurred at random in 1970 and 2010. To distinguish the effects on income distribution caused by changes in the educational levels of men and women and by the greater tendency for selective marriages, an ex- ercise was performed in which the distributions of marriages between 1970 and 2010 were switched. Another experiment analyzed what would have occurred with the income distributions in 1970 and 2010 when exchanging the percentage of unmarried people between these two years, i.e., assuming the size of the unmarried cohort of 1970 was equal to that of 2010 and vice versa. These counterfactual exercises only make sense and produce an effect on the income distribution if the participation of women in the labor market is growing. Based on this, an exercise was conducted assuming that all marriages occurred randomly in 1970 and 2010, but exchanging the participation of married women in the labor force between 1970 and 2010. RESULTS The analysis of the percentage of marriages between people of the same educational level, taking into account that the marginal distributions of men and women among the different educational levels changed over the years reveals an increase in the proportion of selective marriages in Brazil. Despite the increase in the number of selective marriages in Brazil, at first there was im- provement in income inequality, a finding that runs counter to observations in developed countries. However, Brazilian income inequality would have declined even more if this conjugal diversity had not decreased during the period studied. There are strong indications that the presence of married women in the labor force im- pacts income distribution. Besides, in the counterfactual exercise involving exchange of the number of single people between 1970 and 2010, it was possible to note that a larger number of marriages helped to improve Brazil's income distribution, although this effect I was not very substantial. CONTRIBUTIONS OF THE STUDY According to the World Bank, Brazil is one of the ten countries with the greatest income inequality in the world. Understanding the determinants of this high inequality is essen- tial. Although many studies have been conducted in this direction, this project is the first to examine the impact of family organization on income inequality in the country. The methodology employed, recognized internationally, had never been applied to the Brazilian case. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY • The literature on questions of selective marriage and income distribution has only an- alyzed developed countries. It would be interesting to study these questions in other emerging countries and compare them with Brazil. 1 The Lorenz curve is a graph used to represent the relative distribution of a variable in a determined domain. The domain can be the set of people of a region or country, for example, while the variable of interest can be per capita income, among many others. AUTHOR: Cézar Augusto Ramos Santos. RESEARCHER: Luciene Torres de Mello Pereira. ORGANIZATION: EPGE Brazilian School of Economics and Finance (EPGE). SUPPORT: Applied Research Fund (FPA FGV). Annual Report 2018 35 RESEARCH#20Economics THE LONG TERM EFFECTS OF CONDITIONAL CASH TRANSFERS ON CHILD LABOR AND SCHOOL ENROLMENT A conditional income transfer program - such as Bolsa Família which requires school attendance by the beneficiaries' children, has notable impacts throughout the economy. This program has been very successful in fighting poverty and inequality and increasing human capital in Brazil, besides having an important effect on child labor. The results are even more impressive when considering that the transfer represents only 0.55% of gross domestic product (GDP). RESEARCH METHOD • OBJECTIVE • To assess the long-term effects of conditional income transfer programs, such as Bolsa Família, on accumulation of human capital and child labor. The hours of child labor are reduced by 20.4%. And after a gap corresponding to one generation, the portion of children working declines from 22% to 17%, which is near the portion that works in the new stationary state. This suggests that the impacts of Bolsa Família on reduction of child labor occur mainly through its effects on the long-term gen- eral equilibrium, and thus are still to come. CONTRIBUTIONS OF THE STUDY • Studies abound that have examined the effects of conditional income transfer programs on education, child labor and poverty. Many studies have observed that Bolsa Família has only slightly increased the educational level, but to the best of our knowledge, there are no previous studies that have investigated the increase in the accumulation of human capital in the Brazilian economy on the long run. This study fills this gap. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY The changes caused by programs like Bolsa Família have effects that will only be felt totally over an extended period, so the usual methods to evaluate programs can be in- complete or of little use. The article brings a general equilibrium model that allows in- vestigating the long-term effects taking into consideration multiple feedback channels. • A dynamic general equilibrium model of heterogeneous agents is built and calibrated with Brazilian data to analyze a policy similar to that of Bolsa Família. The policy for conditional income transfer is constructed by defining a basic transfer and a basic income limit. The basic income limit includes the net capital and net labor income, but excludes income from child labor. The basic transfer is treated as a normalization and corresponds to what an extremely poor household would receive if their children finished secondary education. All other transfers are proportional to the basic transfer, and are used in the same proportions de- fined by the Ministry of Social Development for the Bolsa Família Program in 2013. Each household whose income is below the basic limit that meets the schooling re- quirement receives a transfer (in the case of only attending primary school, 5/8 of the basic transfer). Besides this, all the households whose income is lower than twice the basic limit receive another transfer, also conditional on schooling, similar to the benefits of Bolsa Família. The basic transfer and program thresholds are defined, and in the equilibrium with Bolsa Familia the total budget of the program corresponds to 0.55% of total output and the coverage of the program is 20.7% of households. As a counterfactual experiment, a new policy is introduced that maintains the previous thresholds and transfers and introduces an extra transfer that does not require school enrollment and is provided to any family aggregate whose total net income is below the basic limit. The extra transfer corresponds to 50% of the basic transfer. RESULTS • The most notable effect of the Bolsa Família program is the accumulation of human capital. Over the long run, the portion of the population not concluding primary school decreases from 47% to 10%. The proportion of adults that conclude primary school in- creases dramatically, from 19% to almost 50%, while the percentage of the adult popula- tion that completes secondary school increases from 25% to 32%. Over the long run, the program increases the percentage of children who finish at least primary school from 52% to approximately 90%. Besides this, the percentage of children who conclude secondary school rises by 30% (from 33% to 41%). On the other hand, the program has almost no effect on college enrollment. AUTHORS: Pedro Cavalcanti Ferreira and Marcel Peruffo. ORGANIZATION: Center for Growth and Economic Development Studies (Growth and Development). SUPPORT: Applied Research Fund (FPA FGV). 36 Annual Report 2018 37 RESEARCH#21Economics THE EFFECTS OF THE UNIFIED SELECTION SYSTEM (SISU) ON STUDENT MIGRATION AND DROPOUT RATES The adoption of a centralized mechanism for admission of college students has a strong impact on the quality of the entering students, besides resulting in better correspondence between students and institutions. It also has a positive effect on mobility of students and increases the turnover of the available openings. OBJECTIVE • The project's primary objective was to investigate if a centralized student selection sys- tem really induces greater geographic mobility, promoting more equal access to higher education among students and greater migration. RESEARCH METHOD • 1. The study considered three databases: 2. 3. 1. Annual microdata from the National High School Achievement Test (ENEM), pro- vided by the Anísio Teixeira National Institute of Educational Studies and Research (INEP), which contains information such as the score on the test, and the municipality of residence of students before college admission. The Higher Education Census, also made available by INEP, which contains geo- graphic and demographic information on students enrolled in institutions of higher learning. A new database, prepared by the Ministry of Education (MEC), with information on all undergraduate programs and the institutions that adhered to the SISU between 2010 and 2014, the cutoff scores for admission, the students, their final choices and whether they were approved regarding their course options In the Census, the following sampling restrictions were imposed: 2. 3. 4. The period was limited to 2010 to 2014 because reliable data only started to be kept in 2010 and the latest Census is that from 2014; Private and municipal public institutions were excluded because they cannot partic- ipate in the SISU; Observations of online educational programs were discarded; The sample was restricted to freshman students. After these restrictions, the final sample was composed of five cohorts of freshman stu- dents with 2,167,313 individuals - admitted between 2010 and 2014 to public federal and state institutions. The microdata from the ENEM were linked to the information from the Higher Education Census by means of the taxpayer number (CPF). We are probably the first researchers to have access to these confidential data. The results of the ENEM tests were standardized to mean zero and standard deviation of one for all participants every year. The dummy variables for migration indicate if the place of residence (or the place of birth) is different than the place where the school is located. We used the geographic location measured at municipal and state levels to capture the inter and intrastate mi- gration patterns. The results of the enrollments were measured among all students registered in the Census and indicated if the students had their registration canceled or received a leave of absence up to the end of the first year. Since openings left vacant due to cancel- lation of registration are probably filled by other students, the two categories were considered separately. RESULTS • In general, positive effects were found for the centralized selection mechanism in the university market. Although the majority of the demographic characteristics of the students admitted remained similar after the centralization, it had a positive impact on the quality of the entering students, measured by their standardized scores. This positive effect corre- sponded to an approximate increase of one-third of a standard deviation, which can be interpreted as a result of better correspondence between students and institutions. The centralization also positively affected the students' mobility. They had a higher probability of coming from a state or municipality different from that where the school is located. In general terms, the integration of the market caused by the centralization increased the interstate mobility by 2.5 percentage points, corresponding to a 25% increase in the basic migration rate. On the other hand, there was an increase in the dropout rate of students in the first year after admission, but without reducing the final rate of openings occupied, since the spaces were filled by new students from a waiting list. The centralization increased the turnover of openings, since spaces were occupied by other students than the final occupant. CONTRIBUTIONS OF THE STUDY • • The empirical literature on the effects of changes from decentralized to centralized ad- mission mechanisms is still scarce, since establishing causal relationships and accessing data pose strong challenges to this type of study. In this project, we provide some initial evidence about the consequences of centralized selection in the university market. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY The configuration of this study indicates its results can be extended to any admis- sion or recruitment effort on a wide geographic scale, such as admission to graduate school or recruitment in the job market. The main aspects of the configuration should include a single metric that classifies the candidates and there should be no geograph- ic restrictions on the selection process. Our results also point to more ample questions for future studies. Since university education is an important determinant of labor market returns, a future study should investigate the cumulative and long-run effects of university centralization. AUTHORS: Cecilia Machado and Christiane Szerman. ORGANIZATION: EPGE Brazilian School of Economics and Finance (EPGE). SUPPORT: Applied Research Fund (FPA FGV). 38 Annual Report 2018 39 RESEARCH#22Economics 目 唱 ECONOMIC POLICY AND GROWTH The study examines the causes and consequences of shantytowns during the structural transformation of countries. Specifically, it investigates the conditions in the markets for education, labor and housing that lead to the emergence of urban slums. OBJECTIVE • To study the interplay of rural-urban migration, urbanization and education. RESEARCH METHOD • • We used a dynamic model with two productive sectors, agriculture on the one hand and services and manufacturing on the other. The dwelling decision of individuals considers three possible places: rural region, urban shantytown and urban non-shantytown, where the accumulation of human capital depends on the dwelling locale. The model reproduced through computational methods the evolution of the Brazilian economy in these different dimensions. Our calibrated model replicated the observed growth of shantytowns (favelas), urbanization, sectorial employment and distribution of education in Brazil from 1950 to 2005. We then investigated via computational experiments the effect of different public poli- cies on income, sectorial allocation of labor and urbanization. First, the cost of habitation in cities increased (e.g., due to greater regularization or taxa- tion), leading to growth of favelas, but this did not affect the rural-urban migration, given that the migrants could still establish residence in favelas. A second policy forbade/removed favelas, preventing the poorest contingent from living in those areas. This policy maintained a large population in the countryside for a longer period, with a strong effect on output and welfare. E 2. 3. The location of households has a strong impact on the educational performance of their children. Our conclusion is that marginal urban areas (favelas) are much worse than regular areas of the city, but much better then rural areas. The dwelling costs in the city are higher than in rural areas, preventing some families with low qualification from migrating to cities. CONTRIBUTIONS OF THE STUDY • We argue that instead of posing a barrier to urban migration, favelas are a place of sup- port for families with low job qualification. For these families, living in favelas provides bet- ter job market opportunities and formation of human capital than living in the countryside. However, when compared with living in regularized urban regions, favelas act as a barrier in terms of opportunities for human capital formation. We show that giving children living in favelas access to schools in regular city areas would improve their school performance. In the aggregate this would lead to a smaller proportion of favelas in cities, because the country's labor force would be less concentrated in workers with low qualification. Besides this, we conclude that barriers of access to favelas -and the maintenance of households with low qualification in rural areas - would decelerate the acquisition of hu- man capital at the lower end of the distribution, inducing even larger favelas in the future. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY • There are three well-defined avenues for future research: 1. Go beyond the human capital formation model and examine in more detail the fac- tors that drive the results of schooling in rural areas and poor urban areas. The expla- nation for the causes of the differences of location of teachers, financing and other educational inputs could suggest a broader scope for public policies. 2. Consider a setting composed of various cities or various urban districts. With respect to households with low qualification, this richer scenario could more precisely cap- ture the consumption-education tradeoffs offered to these households by living in the countryside in relation to different cities and favelas. 3. Extend the "one home/two goods/three occupations" model adopted in this study and consider more elaborate models that manage to capture the impact of the distri- bution of income on the demand for personal services and other urban occupations requiring low skill levels, as one of the main drivers of the formation of urban favelas. RESULTS . Three aspects stand out in the Brazilian experience: 1. Living in a favela is an alternative for individuals who cannot pay the costs of living in regularized areas of cities. It also gives adults in the household access to urban labor markets in general, but this access comes with direct costs, as it reduces the educa- tional options for children to the favela itself and surrounding areas. 40 AUTHORS: João Victor Issler, Pedro Cavalcanti Ferreira and Roberto Castello Branco. ORGANIZATION: Center for Growth and Economic Development Studies (Growth and Development). SUPPORT: Applied Research Fund (FPA FGV). Annual Report 2018 41 RESEARCH#2342 Economics ENVIRONMENTAL REGULATION, TECHNOLOGY ADOPTION AND THE LABOR MARKET: EVIDENCE FROM THE PROHIBITION OF BURNING SUGARCANE IN THE STATE OF SAO PAULO The study of the rapid dissemination of mechanical harvesting that followed the prohibition of pre-harvest burning of sugarcane in the state of Sao Paulo shows that the adoption of an agricultural technology necessary to satisfy new environmental standards can lead to a structural transformation in emerging economies. In this process, one factor is fundamental: qualified workers. OBJECTIVE • To estimate the effects of the prohibition of pre-harvest burning of sugarcane in the state of Sao Paulo on the mechanization of agriculture and possible effects on the structure of the labor markets in the growing regions. RESEARCH METHOD • • To characterize the evolution of mechanization in this industry, we created a Clean Har- vest Adoption Index, with data obtained from remote sensing to detect the type of sug- arcane plantation and harvesting. The index consists of the fraction of the planted area with clean harvesting, i.e., without burning and thus without polluting the air, in relation to the baseline fraction harvested cleanly in 2000 and 2010. To find a causal relationship between the adoption of mechanized harvesting (induced by the end of burning) and the evolution of the labor market in these regions in the past decade, we used an instrumental variables model, where the instruments for mechanized harvesting are engineering characteristics related to the harvesting cost, in particular the slope of the land. To help understand how environmental regulation and adoption of technology affect the demand for different types of workers, we adopted a model with a small open economy having two perfectly competitive industries - rural and urban - using two finite and freely mobile production factors - skilled and unskilled workers. After introduction of a Pigouvian tax on pollution, the rural industry adopts the clean technology any time its costs are sufficiently low in relation to the tax. In these cases the model predicts that the adoption of the clean technology will increase local demand for skilled workers. When such workers are scarce in the economy, this increased demand generates an inflow of skilled workers from the urban industry. Skilled workers are defined as university graduates, and migrants as those who recently moved to a sugarcane production area coming from metropolitan areas. 2. 3. 4. Higher average wages per hour, an effect concentrated in the manufacturing sector, although it also happened in the other sectors. The higher wages can re- flect a marginal increase in the productivity of labor in these areas or a change in the composition of workers. A large increase in the number of skilled workers for each unskilled worker used for production. This appears to be a major change in the demand for skilled labor in this sector. Increased migration of workers from urban areas, mainly consisting of skilled workers from metropolitan regions. At the same time, the number of migrants from non-urban regions was not affected, suggesting that the increased de- mand for skilled workers due to the technical change with bias to qualification attracted this type of worker from nearby urban areas. It is likely that the rural areas of Sao Paulo have benefited from proximity to the supply of skilled workers in urban areas of the state. CONTRIBUTIONS OF THE STUDY The main contribution of the project to the literature on the consequences of en- vironmental regulation in local labor markets is the investigation of the potentially broader positive impact of that regulation in the context of an emerging country. In the developing world, the reallocation of workers between sectors (in particular at- tracting workers away from the traditional agricultural sector with low productivity) can be beneficial to the local economy. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY A recurring result in the literature on how productivity shocks affect the composi- tion of the local economy is that technologies that demand less labor in the agri- cultural sector lead to industrialization of the economy. The technology examined in this study fits in this category, and we obtained results in line with the literature. Nevertheless, we want to understand how that growth of the industrial sector oc- curs. For this purpose, we are working on an input-output matrix to determine what other sectors of the economy are related with the agricultural sector. The prelimi- nary evidence suggests that the industrialization that occurred in the municipalities where this new technology was adopted happened in the same sugarcane produc- tive chain, i.e., something like industrialization of the agricultural sector. RESULTS • The study showed that the adoption of clean harvesting had the following consequences in the average municipality: 1. Reduced participation of employment in the agricultural sector, increased participa- tion of employment in the service sector, and a strong increase in the manufacturing sector, indicating that the adoption of the new clean technology led to a structural transformation in these sectors. AUTHOR: Francisco J.M. Costa. RESEARCHER: Francisco Luis Lima Filho. ORGANIZATION: EPGE Brazilian School of Economics and Finance (EPGE). Annual Report 2018 43 RESEARCH#2444 Economics SERVICES, INDUSTRIAL PRODUCTIVITY AND AGGREGATE PRODUCTIVITY IN BRAZIL The service sector is dominant in terms of value added and labor, but typically receives little attention compared to the industrial and agricultural sectors. This study develops a theoretical model in which services are not only a final consumer good, but also an intermediate good, and evaluates the repercussions on the productivity of the other sectors of the economy. OBJECTIVE • To quantitatively evaluate the effect of services, considered to be intermediate goods, on aggregate productivity in Brazil and their impact on the productivity of the other sectors, particularly industry. RESEARCH METHOD • We developed a general equilibrium model in which there are three types of goods and sectors of the economy: agriculture, industry and services. For each sector, firms produce goods destined for consumption of individuals or utilized by other firms as intermediate goods. Firms decide how much labor to employ and the volume of intermediate goods to use. The economy is inhabited by an infinite number of homogeneous agents, who offer labor and decide how much of each good to consume. According to the method normally used in models like this, it is assumed that some pa- rameters are directly observed in the data, while others, which do not have a clear cor- respondence with the data, are estimated based on the model's equilibrium conditions. In the computable general equilibrium model, services are not only consumption goods, they also serve as intermediate goods. The idea is that the firm in the industrial sector has a production function that uses inputs from labor and intermediate goods. In this case, low productivity of services affects the productivity of industry and of the service sector itself. The model was calibrated and simulated for the Brazilian economy,, closely reproduc- ing the data, as for example, aggregate labor productivity and the distribution of labor among the sectors. Counterfactual exercises were implemented in which a parameter or exogenous variable was modified. The objective of all the exercises was to understand the impact of sectoral changes on the economy as a whole, as well as to measure and compare the gains from changes in total factor productivity (TFP) and in the productive structure of the econo- my. Unlike what happens in models without intermediate goods, a multiplicative effect now exists that those models do not capture and that can have sizable effects on the economy and sectoral productivity. of the American economy, while maintaining the sectoral structure constant and equal to that calibrated for the Brazilian economy. This result is in the same direction as results obtained with very different methods. Al- though the values are not the same, the orders of magnitude in the two experiments are close to each other. This confirms, now in a more detailed theoretical model, that the problem of low productivity in Brazil is more a problem of level, with all sectors having weak productivity, than of composition. This means that Brazil is not specialized in sec- tors with low productivity, but that productivity in all sectors of the Brazilian economy is relatively small. CONTRIBUTIONS OF THE STUDY . The experiment is important to establish the relevance of including intermediate goods when one is interested in investigating the impacts of sectoral changes - mainly of varia- tions in productivity of services - on the aggregate productivity of the economy. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY The project sheds light on the sectoral relations in the Brazilian economy, providing in- struments to attain more effective policies for growth in Brazil. Given that all economies tend to shift more to services as they develop, better knowledge of this sector's func- tioning and its determinants is a necessary condition for implementing effective policies in Brazil. RESULTS • The results show that a change in the productive structure alone would induce a small increase in productivity. With all else constant, if Brazil had coefficients of the production function equal to those of the United States - and consequently elasticities of production in relation to intermediate goods equal to those of that country, productivity would be 21% higher than observed in the data. Brazil's relative productivity would jump from 14.4% to 17.5% of that of the USA, a modest gain. However, although relevant, this gain is significantly lower than what would be observed by attributing to each of the three sectors the productivity of the corresponding sectors AUTHORS: Fernando Veloso, Pedro Cavalcanti Ferreira and Bruno Ricardo Delalibera. ORGANIZATION: Brazilian Institute of Economics (IBRE), Center for Growth and Economic Development Studies (Growth and Development) and EPGE Brazilian School of Economics and Finance (EPGE). Annual Report 2018 45 RESEARCH#25Law THE PRISON SYSTEM AND BRAZILIAN COURTS: THE JUDICIARY'S REACTION TO A HISTORICAL CRISIS The analysis of decisions by 10 State Appellate Courts and the Brazilian Federal Supreme Court in the period from 2006 to 2017 found that the cases mapped do not reflect the reality of violence and abuses committed within the penitentiaries. There is a chasm between the main issues and problems of the prison system and the ones that reach the Judiciary. Also lacking are discussions regarding criteria for awarding damages, which leads to random (and different) amounts being awarded to similar cases. OBJECTIVE The goal was to analyze the reaction by Brazilian appellate courts to the violations of Human Rights in the country's prison system and to verify whether, in assuming a more active role in constructing solutions to the historical prison crisis, the Judiciary has pre- sented responses that are appropriate to these problems. RESEARCH METHOD • 1. The study entailed the following steps: 2. 3. Search for decisions about the main legal questions referring to the prison system, from 2006 to 2017, of 10 State Appellate Courts and of the Federal Supreme Court. The state courts were selected to obtain regional diversity; their size (by population) was also taken into account. The following states were chosen: Sergipe, Rondônia, Amazonas and Roraima (small size); Bahia, Santa Catarina, Federal District (included as a state) and Pará (medium size), and Sao Paulo and Rio de Janeiro (large size). Mapping of the main legal theses present in the decisions selected, according to the following themes: i) institutional violence; ii) inadequate facilities; and iii) rights and guarantees of inmates. The definition of the themes took into consideration the quan- titative impact of each theme in the total amount of cases mapped and the novelty of the jurisprudence set forth in the selected cases. Analysis of the cases and identification of the solutions presented by the judges in quantitative terms, along with evaluation and comparison of the positive and nega- tive aspects of these solutions. Only decisions by appellate panels were considered, meaning no cases decided by a single judge at the appellate level or verdicts by first-level courts without appeal were considered. 11,039 decisions were consulted: 1,900 from the Supreme Court and 9,139 from 10 State Appellate Courts surveyed. Of these, 501 Supreme Court decisions and 2,061 state court decisions were considered relevant, for a total of 2,562 decisions examined in detail. RESULTS • • The most common and relevant questions involving the prison system addressed by the courts were poor conditions (especially in collective suits), death and torture (theme of institutional violence); determination of the possibility of serving sentences in inadequate facilities (theme of inadequate facilities); and visitation privileges, occasional home re- lease and remuneration for labor (theme of inmate rights and guarantees). The state appellate courts diverged among themselves on specific themes (creating re- gional jurisprudence), or even within the same court (by different panels of judges). The Prosecutor's Office appeared in two instances: at the same time as they were (i) the leading plaintiffs in collective actions aimed at improving the prison system as it related to minimum human dignity - such as lack of food, inhuman conditions and torture (in 89% of the suits involving collective rights, the decision ordered the respective government body to comply with Human Rights obligations and 85% of said cases were proposed by the Prosecutor's Office); and (ii) the prosecutors in individual cases, where they did not present nor defend the same understanding of "human dignity" and "resocialization". CONTRIBUTIONS OF THE STUDY • The cases drawn from the State Appellate Courts do not reflect the reality of the violence that occurs within the prison system. The number of decisions involving degrading condi- tions, torture and death from 2006 to 2016 (208 from state appellate courts and 18 from the Supreme Court) indicates that a huge gap exists between what happens behind the prison walls and what reaches the Judiciary. The examination of the decisions in individual suits (as opposed to collective suits) in the three thematic categories (degrading conditions, torture and mistreatment, and deaths) indicated the prevalence in quantitative terms of actions for civil liability of the govern- ment (compensation for moral damages and survivor benefits). The predominant posi- tion of the state courts, as well as of the Supreme Court, is to recognize the objective (strict) liability of the government for damages caused by degrading conditions, torture and death of inmates. But in nearly all the decisions examined, there was no discussion of guidelines and crite- ria for setting the awards and survivor benefits, resulting in discrepancies between State Appellate Courts and even between different panels within the same court. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY In light of the results obtained based on the 10 State Appellate Courts selected, a fol- low-up study including other Brazilian states would be useful. • • It is important to identify the reasons for so little uniformity among the decisions in cases involving the national prison system. The disconnect between the responses of the Judiciary and the gravity of the cases brought to justice suggests the need for the prioritization of an agenda for remedial action involving not only the state governments, but also judges, prosecutors, public attorneys, public defenders, and civil society. The increased presence of cases involving the theme "prison system" in the Federal Supreme Court in recent years and the development of new understandings, including through binding precedents, have not been sufficient in reversing the widespread vio- lation of the rights of inmates. The next steps to remedy this situation should consider complementary paths to those already followed by the judicial branch. AUTHORS: Michael Freitas Mohallem, Rogerio Sganzerla and Tamara Moreira Melo. RESEARCHERS: Ana Heymann Arruti, Gabriel Desterro e Silva Pereira, Luiza Lucas Bruxellas, Lucas Meireles, Maryanna de Souza Moraes and Rebeca Maria Borges Abrunhosa. ORGANIZATION: Center for Justice and Society (CJUS) of the Rio de Janeiro School of Law of Fundação Getulio Vargas (Direito Rio). SUPPORT: Porticus Latin America. 46 Annual Report 2018 47 RESEARCH#26Applied Mathematics 3D TECHNOLOGIES APPLIED TO PRESERVATION OF CULTURAL HERITAGE COLLECTIONS The digitization of an ivory model of a Chinese junk at the National History Museum contributed to comprehension of the importance of using 3D technology for documentation, research and dissemination of cultural heritage artifacts. A series of questions are highlighted about the preservation of the rich national collection, helping to clarify how technology can contribute to this task. OBJECTIVE . To disclose the available technology and its potential use to support the documentation, preservation and disclosure of cultural heritage artifacts. To digitize a three-dimensional object belonging to the collection of Brazil's National History Museum, an ivory model of a Chinese junk. This object was chosen because of the technical challenges of its digitization as well as the historical importance and the rich possibilities of its presentation to museum visitors. RESEARCH METHOD • The initial phase involved dialog between the researchers in the area of computer graph- ics and researchers of the museum about the potential and limitations of the technology, in which the particularities of the items belonging to the museum were presented so as to converge to a choice of the object to be digitized. The approach used for the digitization of the junk, taking into consideration the chal- lenges posed by the item, the limitations of the available technological solutions and the restrictions of the setting, was a hybrid, using photogrammetry along with synthesis by conventional 3D modeling. The solution proposed for the digitization of the Chinese junk model did not rely on specific digitization hardware, since it was based on photogrammetry and conventional modeling, thus depending only on conventional photographic cameras and a technician specialized in 3D modeling. The 3D modeling software used was free, so there was no license fee. The cost only cov- ered the payment of the hours worked by the technician. CONTRIBUTIONS OF THE STUDY The utilization of technology expands the possibility of visiting the museum's collection, which can be accessed remotely, besides presentation of in loco resources that enrich visits and contextualize the history of the object. The 3D documentation of the item chosen is highly relevant to the collection of the Na- tional History Museum, because it offers digital options for its presentation, and given the fragility of many of the objects, helps its conservation. The project as a whole is an example of the multidisciplinary capability of museum re- searchers regarding their collections, by mobilizing different areas of knowledge from the human and exact sciences, generating different ways of producing knowledge and enhancing expertise involving a museum object. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY The content produced for the website also is being used by the educational sector of the museum in the case of group visits. • New efforts will involve searching for better methods to digitize intricately detailed sur- faces using a combination of digital images and synthesized content. A possibility that arose from the discussion with the museum team was using the pro- posed technology to monitor the state of deterioration of some artifacts, more specifically the tracking of how fissures and cracks evolve over time, and the impact of lending items for display in other museums or venues. Doing this with inexpensive equipment such as digital cameras is an interesting challenge and can be investigated by future studies. RESULTS • A feasible path was opened for insertion and application of the technology in future ef- forts for preservation and dissemination of museum collections. A better understanding was obtained about the particular challenges faced by develop- ing countries, like Brazil, to promote the use of digital technologies in the heritage sector. These challenges include lack of understanding of technologies and of the nature of her- itage collections and the shortage of adequate infrastructure. A website was produced (http://barco.museus.gov.br/) that contains interviews with re- searchers of the museum, as well as an interface in which the 3D model of the Chinese junk can be rotated, indicating some points of special interest, including the decorative motifs and the Chinese tradition of ornate carving. The interviews address different aspects of the context of production and circulation of objects made of ivory: the oriental influences in colonial Brazil; the modes and styles of the Orient in society in Rio de Janeiro; the colonial trade in the Indian Ocean and east coast of Africa; ivory carvings as art objects; and historical documentation. AUTHORS: Asla Medeiros e Sá and Paulo Cezar Carvalho. RESEARCHERS: Karina Rodriguez Echavarria, Rafael Zamorano Bezerra and Ricardo Guerra Marroquim. ORGANIZATION: School of Applied Mathematics (EMAP). SUPPORT: Applied Research Fund (FPA FGV), Cultural Informatics Research Group, Graphic Computation Laboratory of the Alberto Luiz Coimbra Institute of Graduate Education and Research in Engineering (COPPE), of Rio de Janeiro Federal University (UFRJ) and National History Museum. 48 Annual Report 2018 49 RESEARCH#27Administration VISUALIZING PARTY POLITICS: ELECTIONS AND POLITICAL CAREERS IN BRAZIL Compared to changes occurred in the analyses of public policies, the study of the functioning of the Brazilian political system lags behind. In this area, most works do not present a solid empirical base, and have used selected cases only to illustrate the main point. This mismatch brings considerable difficulties to those dedicated to improving these policies. It limits the comprehension of the restrictions imposed by politics on the formulation of innovative proposals and reduces their chances of implementation. The objective of this project is to eliminate this mismatch, by creating conditions for the discussion of proposals for innovation also based on detailed political data and empirical evi- dence. For this, it is necessary for data to be obtained rapidly, at low cost, with dissemination to a broad public. This project contributes to filling this gap by creating systems to visualize electoral data and information on political careers on the internet and with applications for tablets and smartphones. OBJECTIVE • To popularize access to electoral data and information on the career paths of Brazilian politicians, as well as to analyze and visualize these data by creating systems on the in- ternet and applications for tablets and smartphones. RESEARCH METHOD • • Use of Data Warehousing (DW) techniques and development of Business Intelligence (BI) projects to assemble databases, from loading to final consultation. First, address the problem the so-called "vertical big data" or "big noise". It is necessary to deal with extensive databases (the results of a candidate in each electoral precinct, of all members of a party, etc.), which present noise because the data are not perfectly "clean". The second methodological challenge is called "big data", also called "horizontal big data" to differentiate it from "vertical big data". In this case, the problem is not necessar- ily a substantial number of records (or lines), but instead a large number of fields (col- umns). At first, it is unknown which fields should compose a database, and this statistical problem (with a Bayesian appeal) requires an answer. Big data techniques are necessary because there will be gaps in the careers of politicians. The process of matching the po- litical party membership data with data from other sources, such as the RAIS (Annual List of Social Information), will be facilitated with the use of these techniques. Finally, the project includes an effort to georeference polling places. The traditional geo- referencing applications (Google Maps and Here) are used as inputs in a more powerful system that allows performing this task more effectively. The construction of this tool results in a much higher potential to locate information about public policies in general. It is possible to associate sociodemographic data with voting places, something not pro- vided by any other database. RESULTS • The system on the internet has already been prepared and opened to the public at large due to our decision to realize the "CepespData Challenge", which attracted many start- ups of information technology to suggest improvements in the CepespData. Based on the data collected, several academic articles have been published or are under analysis for publication. Each article generated by analysis of the electoral data and infor- mation on politicians' careers will have a broader public version for the general press. A book will also be published with analysis of the composition of state's cabinets. CONTRIBUTIONS OF THE STUDY • Creation of the section called "Electoral Maps" at the site (http://spatial2.cepesp.io/), enabling the public at large to visualize the electoral maps of all candidates for elective office in statewide races (governor, senator, federal deputy, and state deputy). At the end of the project, users will have simple and fast internet access to the electoral pattern over time of all relevant candidates and elective offices since 1998. The system developed for the internet permits other systems to incorporate this informa- tion into their applications or search sites, for greater dissemination of knowledge. APPLICATIONS OF THE RESULTS AND POSSIBLE EXTENSIONS OF THE STUDY The CEPESP received an invitation from the news portal JOTA (https://jota.info/) to have a permanent column. The texts will cover so-called "Evidence-Based Politics", in an anal- ogy to "Evidence-Based Public Policies".. Likewise, the group of researchers of the CEPESP involved in the CepespData project has reached an agreement with the newspaper Valor Econômico to publish 18 weekly columns on the elections using the data available in the CepespData system. These researchers also have been undertaking intense work to disclose the site among journalists covering the 2018 elections. In the same sense, a seminar will be held each year gathering journalists and academics to disseminate the CepespData system. Interest in CepespData and the analyses it enables has been growing. A discussion is underway for an arrangement with Brown University for continuing work on the site. Sim- ilarly, Fundação Brava will finance studies to be conducted by the CEPESP team on the financing of election campaigns in Brazil. Finally, researchers of the Sao Paulo School of Law (Direito SP) are developing an applied research project on "Democracy and Repre- sentation in the 2018 Elections", involving the association with CEPESP researchers and intensive use of the data from CepespData. From the standpoint of teaching, this project will serve as an embryo for a new course aimed at professionals involved in political campaigns and other interested people. AUTHORS: Ciro Biderman and George Avelino. RESEARCHERS: Jonathan Philips and Natália S. Bueno. ORGANIZATION: Center for Public Sector Policy and Economics (CEPESP) of the Sao Paulo School of Law (Direito SP), Sao Paulo School of Business Administration (EAESP) and Sao Paulo School of Economics (EESP), all of Fundação Getulio Vargas. SUPPORT: Applied Research Fund (FPA FGV) of Fundação Getulio Vargas, São Paulo State Research Support Foundation (FAPESP), Superior Electoral Tribunal (TSE) and Brown University. 50 Annual Report 2018 51 RESEARCH#28FGV IN 2018#2954 W With over 70 years of history, Fundação Getulio Vargas has been following up and contributing to the socioeconomic development of Brazil, through the formation of some of the main national lead- erships, dissemination of economic indices that assist in the decision-making process of public managers and the private sector, or research developed to guide the adoption of several public policies that are capable of transforming society. All this work places FGV as one of the world's leading think tanks. FGV's concern is, therefore, to be a permanent precursory institution, both for its students and for society in general. This is reflected in its daily activities, with the concern of its professionals for the search for innovation and pioneer- ing in their field of expertise. This incessant search for being at the forefront has enabled FGV to a benchmark in education both in Brazil and abroad with its undergraduate and graduate courses (professional Master's, academic Master's and Doctoral pro- grams) and for its strong and constant expansion throughout the national ter- ritory, through institutions that offer executive education courses in the most diverse formats in the four corners of the country. Its vast educational portfo- lio covers areas such as Public Administration and Business, Social Sciences, Law, Economics, Applied Mathematics, and International Relations. Brazil's borders, however, are no barriers to the diffusion and sharing of knowledge produced in its schools and research centers. With an academic output comparable to that of the world's most advanced institutions, FGV is a partner of more than 200 renowned universities and research centers around the globe. This concern regarding the production and diffusion of knowledge is what drives FGV and makes it an innovative institution, committed to national de- velopment, formation of an academic elite, generation of public goods in so- cial areas and related purposes, ensuring its economic sustainability with the provision of quality services and a high ethical standard. IN 2018 FGV Cultural Center The 6th best think tank in the world and the leader in Latin America by the 2018 Global Go To Think Tank Index Report, prepared by the University of Pennsylvania. FUNDAÇÃO GETULIO VARGAS (FGV) President: Carlos Ivan Simonsen Leal. Vice Presidents: Sergio Franklin Quintella. Francisco Oswaldo Neves Dornelles (licentiate). Marcos Cintra Cavalcanti de Albuquerque (licentiate). Leader in the Brazilian ranking according to the General Course Index (IGC) of the Ministry of Education (MEC), occupying the first three places. Top score for all schools evaluated by Guia do Estudante (GE), published by Editora Abril. Annual Report 2018 55 FGV IN 2018#3056 Elected one of the companies that communicate best with journalists by the magazine Negócios da Comunicação. EMPRESAS QUEMELHORSE COMUNICAM COM JORNALISTAS EDUCAÇÃO FGV BEDIÇÃO 1 2018 comunicação CECO Award won Sérgio Moro, Minister of Justice and Public Security Launch of the FGV website in Chinese. Candidates for the government of the state of Rio de Janeiro Promotion of the event "Diálogos #EducaçãoJá - Propostas para o Estado do Rio de Janeiro" ("Dialogues #EducaçãoJá - Proposals for the State of Rio de Janeiro"). Lunch in honor of the Minister of the Supreme Federal Court (STF), Dias Toffoli. Organization of the "National Symposium on Combating Corruption". FGW FGV 2018 INSTITUTIONAL VIDEO ALEKBORD WEERBYAL Public authorities and senior management of the FGV Annual Report 2018 57 FGV IN 2018#3158 FGV IN NUMBERS YAYAY 180 books published. 3,181 academic papers by professor, researchers and technicians. 88,673 executive and continuing education students. 817 events organized and jointly organized. 4,841 undergraduate students. 396 regular and completed studies and surveys. 1,879 master's students. 327 projects and technical advisory services. 443 doctoral students. Annual Report 2018 59 FGV IN 201#3260 1,012,471 Total engagement on official social networks. 453,206 Total content posted on Institutional social media. SOCIAL NETWORKS 3,456,146 Total number of followers. 11,865,404 Minutes of videos watched on FGV's YouTube channel. 2,416 Total videos on YouTube. 546,618 Total new social media followers. 328,191,135 Total reach of posts on FGV's official channels. Annual Report 2018 61 FGV IN 2018#3362 AREAS OF EXPERTISE FGV operates in various fields of knowledge. Learn more about the areas of the institution: HIGHER ADMINISTRATION General Meeting Board of Trustees Board of Directors Presidency Vice Presidencies Provost Office SERVICES, INDEXES AND PUBLICATIONS Press IBRE Brazilian Institute of Economics Projetos FGV EDUCATION CPDOCSchool of Social Sciences Direito Rio Rio de Janeiro Law School Direito SP - Sao Paulo Law School EAESP - Sao Paulo School of Business Administration EBAPE - Brazilian School of Public and Business Administration EESP - Sao Paulo School of Economics EMAP - School of Applied Mathematics EPGE EPGE Brazilian School of Economics and Finance IDE - Institute for Educational Development IDT - Institute for Technological Development RI - School of International Relations SPECIAL PROGRAMS GENERAL ADMINISTRATION DCI Internal Control Division CV DICOM - Communications and Marketing Division DO Division of Operations - HRD - Human Resources Division Research Network - Research and Applied Knowledge Network SB Library System Controllership Superintendent's Office Treasury Chamber - FGV Mediation & Arbitration Chamber CDMC - Center for the Development of Mathematics and Science CERI - Center for Regulation and Infrastructure Studies Growth and Development - Center for Growth and Economic Development Studies DAPP - Department of Public Policy Analysis DGPE Center for the Development of Public Management and Educational Policies DINT - International Affairs Division Energy - Center for Energy Studies NPII - International Intelligence Unit Social Center for Social Policy - Annual Report 2018 63 35 FGV IN 2018#34CPDOC SCHOOL OF SOCIAL SCIENCES Dean: Celso Castro Established in 1973, the Center for Research and Documentation of the Contemporary History of Brazil (CPDOC) was created with the purpose of maintaining and producing relevant documentary sources for the history of the country. Years later, in 2005, CPDOC expanded its activities to teaching, creating the FGV's School of Social Sciences. CPDOC offers a Bachelor's degree in Social Sciences, in addition to lato sensu and stricto sensu graduate programs. IN 2018 • • • • • Launch of the virtual exhibition on Getulio Vargas. Inclusion of the Journal of Historical Studies, classified as Qualis A1 in the area of History by the Coordination for Improvement of Higher-Level Per- sonnel (CAPES), in the two main indexing platforms for scientific journals in the world: Elsevier's Scopus, and Web of Science, from Clarivate Analytics. Historical archive with over 2 million handwritten, printed and audiovi- sual documents. Third place in the latest list published by the General Course Index (IGC) of the Ministry of Education (MEC). More than 7,000 entries in the Brazilian Historical-Biographical Dictionary. • 75 undergraduate students. • 95 master's students. . 53 doctoral students. More information at fgv.br/cpdoc. 64 CPDOC House Archive estudos históricos H 65 Associativismo e Movimentos Sociais FGV CPDOC Cover of the Journal of Historical Studies CPDOC offers a Bachelor's degree in Social Sciences, in addition to lato sensu and stricto sensu graduate programs. "SAIO DA VIDA PARA ENTRAR NA HISTORIA": GETULIO VARGAS E A PROPAGANDA POLITICA e da FGV CABOC Website of the virtual exhibition on Getulio Vargas ahen Annual Report 2018 65 EDUCATION#35DESENVOLVIMENTO Panel of the event "Law and Development Seminar" with STF Minister, Carmen Lúcia, and the Dean of Direito Rio, Sérgio Guerra Cam La Antunes Roch FGV DIREITO RIO swaldo Britto DIREITO RIO RIO DE JANEIRO LAW SCHOOL Dean: Sérgio Guerra Direito Rio is also a pioneer in its field of activity, having created Brazil's first Master's degree in Regulation Law. Established in 2002, Direito Rio aims to innovate in legal education, research, didactics, and the curriculum of a Law course. Its main goal is to contribute to the formation of leaders that think about Brazil in the long term. As a benchmark in teaching and research in Law, it aims to promote the academic and executive training of professionals of public and private careers. Direito Rio has its own virtual library and edits publications that address Law in a multidisciplinary way. It is also a pioneer in its field of activity, having cre- ated Brazil's first Master's degree in Regulation Law. The school operates on multiple fronts, such as undergraduate, gradu- ate and continuing education courses, as well as through research centers focusing on issues that address judicial, technological, economic, and envi- ronmental reform. It also features a degree in Law with a dual diploma in Administration, Social Sciences and Mathematics, as well as Complementary Education in Administration, Social Sciences, Economics, Mathematics, and International Relations. Panel of the event "30 Years of Constitution: Democracy, Institutions and Reality" at the FGV Cultural Center 30 ANOS DE CONSTITUIÇÃO: DEMOCRACIA, INSTITUIÇÕES E REALIDADE 30 ANOS DE CONTIMICAS DEMOCRACIA INções REAURAD OR REVITORIO CAPLE 66 COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL CHUMBA LA SCHOOL COLUMBIA LAW SCHOOL REAL SCHOOL COMEIN LAW SCHOOL OLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL OLUMBIA LAW SCHOOL LUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL LUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL CUMBLA LAW SCHOOL COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL LUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL COMES Cou SCHOOL AW SCHOOL LAW SCHOOL COLU 1OOL RESERVED RESERVED COLUMBIA LAW SCHOOL COLUMBIA LAW SCHOOL LAY SCHOOL COLUMBIA LAW SCHOOL LAW SET COLUMBIA LAW SCHO HOOLDAMELOV SCHO COLUMBIA LAW SCP OL CHEERATAW'S TOLUMBIA LAV RESERVED • IN 2018 Promotion of the event "30 Anos de Constituição: Democracia, Institu- ições e Realidade" ("30 Years of Constitution: Democracy, Institutions and Reality"). Organization of the "Seminário Direito e Desenvolvimento" ("Law and De- velopment Seminar"), in Brasilia. Participation in the CLS Brazil Forum, in New York City (United States). First overall place in Brazil in the 25th Examination of the Brazilian Bar As- sociation (OAB). Maximum score in Guia do Estudante (Student Guide). Exchange program agreements with 60 renowned foreign universities, such as: Harvard, Yale, Columbia, and NYU. 243 undergraduate students. 40 master's students. More information at fgv.br/direitorio. Panel of the event CLS Brazil Forum, with Professor Thiago Bottino, from Direito Rio RVED RESERVED Annual Report 2018 67 EDUCATION#3668 • . DIREITO SP SAO PAULO LAW SCHOOL Dean: Oscar Vilhena Vieira Established in 2002, Sao Paulo Law School was founded with the goal of forming a new generation of jurists who are capable of responding to the challenging demands of contemporary society. The school bets on an innovative pedagogical proposal, preparing its stu- dents to act in the public and private spheres through a continuous dialogue with other fields of knowledge. Sao Paulo Law School offers undergraduate, professional Master's, aca- demic Master's and lato sensu graduate courses in areas such as Business Law, Tax Law, and Intellectual Property. IN 2018 Creation of CEPI - Education and Innovation Research Center. • Creation of CeDHE - Center for Human Rights and Business. • Creation of the Diversity Committee. • Maximum score in Guia do Estudante (Student Guide). Cooperation agreements with over 40 international research and higher education institutions. • Approval of the PhD in Law and Development. 351 undergraduate students. • 205 master's students. More information at fgv.br/direitosp. CEPI Education and Innovation Research Center team The school bets on an innovative pedagogical proposal, preparing its students to act in the public and private spheres. Professor Thiago Amparo, from Direito SP, member of the Diversity Committee Annual Report 2018 69 EDUCATION#3770 Santander Space Gilberto Sarfati, Professor at EAESP and Coordinator of the Master's degree, at the graduation EAESP SAO PAULO SCHOOL OF BUSINESS ADMINISTRATION Dean: Luiz Artur Ledur Brito Established in 1954, EAESP is the most internationalized school in Latin America, with over 100 partnerships with internationally renowned foreign institutions in all continents. It is also acknowledged as a high-level center for research in business administration and training of business, government and academic leaders. Obrigado Santander D EAESP is the most internationalized school in Latin America, with over 100 partnerships with internationally renowned foreign institutions. EAESP is one of the few business schools in the world and the first in Brazil to have triple international accreditation: Association to Advance Collegiate Schools of Business (AACSB), European Foundation for Management Devel- opment (EFMD), and Association of MBAS (AMBA). It offers undergraduate courses in Business Administration and Public Ad- ministration, as well as executive education programs and academic and pro- fessional Master's and doctoral programs. Some of its courses are fully taught in English. • IN 2018 • Graduation of the first class of the largest professional Master's degree in Brazil. Achievement of the second prize at GM Xperience. Inauguration of the Santander Space at the Academic Directory. OneMBA ranked the best executive MBA in Latin America by the Finan- cial Times. Maximum score in Guia do Estudante (Student Guide). 2,297 undergraduate students. 640 master's students. 222 doctoral students. 490 lato sensu graduate students. More information at fgv.br/eaesp. Winning team at GM Xperience Annual Report 2018 71 EDUCATION#38• EBAPE BRAZILIAN SCHOOL OF PUBLIC AND BUSINESS ADMINISTRATION Dean: Flavio Vasconcelos Rosmari Capra Sales, former MEX student, and Marisol Rodriguez Goia, Professor at EBAPE, awarded by ANPAD Established in 1952, EBAPE aims to produce and disseminate knowledge, as well as promoting research and training of qualified professionals to act in leadership positions in the public and private areas, as well as in the academic area. As a pioneering institution, it was the first Administration School in Brazil and in Latin America. EBAPE offers courses in the areas of Administration at the undergraduate level (distance and in-person), professional Master's degrees in Public (MAP) and Business (MEX) Administration, as well as academic Master's (MSc) and doctoral (PhD) programs. It features programs offered in English - MSc & PhD and Double Degree with Católica-Lisbon and the International Masters Pro- gram in Practicing Management (IMPM) - EQUIS-EFMD international accredi- tation, as well as dozens of strategic partnerships and student exchanges. - AANIAD Associação Nacional de Porc Pesqm Admi Confere o Primo Melhor Artigo Derivado de linea Escolarizaçãn Cosme Didintie Um Estudo Sobre a d Internal Ride La IN 2018 • MEX survey award by the National Association of Graduate Studies and Research in Administration (ANPAD). • Lecture with Professor Henry Mintzberg of McGill University (Canada). • Best Paper at the 2017 Globe Robert J. House Research Paper Award. • Maximum score in Guia do Estudante (Student Guide). Maximum score in the General Course (IGC) of the Ministry of Education (MEC). • AACSB International accreditation. 1,005 distance learning (DL) students. • 204 in-person undergraduate students. • 298 master's students. • 38 doctoral students. More information at fgv.br/ebape. 72 MA AANPAD Associação Nacional de Pós-Graduação e Pepe Administ Confero Pro Melhor Artigo Derivado de Dissertação de Mestrado Prosal Escolarização e Como Didintive Um Estudo Sobre a Escolha das Fals International no Rio de Janei As a pioneering institution, it was the first Administration School in Brazil and in Latin America. EBAPE Professors Rafael Goldszmidt, Juliana Mansur and Filipe Sobral, winners of the 2017 Globe Robert J. House Best Research Paper Award and ANP Atzber Professor Henry Mintzberg at the lecture Annual Report 2018 73 EDUCATION#391st Brazilian Data Science Meeting The school is a center of excellence in research and teaching of Economic Science in Brazil, being acknowledged by various national and international organizations. 1st Brazilian Data Science Meeting in FGV's 9 de Julho Auditorium 74 1st Brazilian Data Science Meeting A velocidade da mudança XFFGV EESP SAO PAULO SCHOOL OF ECONOMICS Dean: Yoshiaki Nakano Established in 2004, EESP aims to contribute to the country's development through knowledge of the Brazilian reality and strengthening of the national identity. The school is a center of excellence in research and teaching of Economic Science in Brazil, being acknowledged by various national and international organizations. It is, in Brazil, the school with the highest number of citations received, according to Google Scholar. The school offers undergraduate, advanced, lato sensu graduate, profes- sional Master's, academic Master's and doctoral programs. IN 2018 Organization of the 1st Brazilian Data Science Meeting. Promotion of the seminar "Perspectivas Econômicas e Políticas em 2019" ("Economic and Political Perspectives in 2019"). The first educational institution in Brazil to become Ripple's partner in the production of studies and research on blockchain, cryptocurrency, and digital payments. Partnership with the Sao José dos Campos Ecological Park. 147 undergraduate students. 265 lato sensu graduate students. • 277 master's students. • 32 doctoral students. More information at fgv.br/eesp. Annual Report 2018 75 EDUCATION#4076 EMAP SCHOOL OF APPLIED MATHEMATICS Dean: César Camacho In line with the mission of Fundação Getulio Vargas, EMAP has been consolidating its strategy of becoming an institution of excellence in Applied Mathematics, with leading research groups in important areas of Mathematics for Brazil. The school characterizes its focus on applications to real-life issues that can be modeled using mathematical methods. IN 2018 • . • • Organization of the Financial Mathematics Team Challenge Brazil. Launch of the 2018 World Cup website. Organization of the "Introduction to Data Science Bootcamp" workshop (Rio de Janeiro and Sao Paulo). First place in the National Student Performance Examination (ENADE) among private Mathematics institutions and 3rd place in Brazil. Agreements and partnerships: Institut National de Recherche en Infor- matique et en Automatique (Inria), Military Engineering Institute (IME), Fundação Oswaldo Cruz (Fiocruz), Pure and Applied Mathematics Insti- tute (INSP), National Public Security Institute (INSP), and University of Sao Paulo (USP). 79 undergraduate students. . 26 master's students. More information at fgv.br/emap. Cav "Introduction to Data Science Bootcamp" workshop at the FGV Cultural Center 2018 World Cup website The school characterizes its focus on applications to real-life issues. SAIDA EXIT Modelos Matemáticos na Copa do Mundo 2016 Participants of the Financial Mathematics Team Challenge Brazil INTRODUCTION TO DATA SCIENC BOOTCAMP HOT CHI Annual Report 2018 77 EDUCATION#41Pedro Feijó de Moraes, Student at EPGE, awarded 1st place at ANPEC Since its foundation, it has trained a large portion of the most renowned Brazilian economists. SEMINÁRIO MISSÕES RELIGIOSAS E EDUCAÇÃO BÁSICA NO BRASIL FGV EPGE 78 V Panel of the event "Women, Business and the Law 2018" at FGV Main Office EGL Panel of the event "Religious Missions and Basic Education in Brazil" at FGV Main Office EPGE EPGE BRAZILIAN SCHOOL OF ECONOMICS AND FINANCE Dean: Rubens Penha Cysne Established in 1961, EPGE aims to contribute to teaching and the expansion of knowledge in the field of Economics. Since its foundation, it has trained a large portion of the most renowned Brazilian economists. Through its professors and students, it has also effective- ly contributed to the national development. The school offers undergraduate and graduate stricto sensu courses in Eco- nomic Science. IN 2018 First place in the General Course Index (IGC) of the Ministry of Education (MEC), among over 2,000 higher education institutions (HEI) in Brazil. First place in the national examination of the National Association of Grad- uate Economics Centers (ANPEC) for the second consecutive year. World Bank Seminar "Women, Business and the Law 2018". Seminar "Religious Missions and Basic Education in Brazil". First Department of Economics in Latin America according to the Tilburg rankings. First place in the National Student Performance Examination (ENADE) for the second time in the four evaluations carried out by the Ministry of Ed- ucation (MEC). Maximum score in Guia do Estudante (Student Guide). 188 undergraduate students. 168 master's students. 37 doctoral students. More information at fgv.br/epge. Annual Report 2018 79 EDUCATION#4280 IDE INSTITUTE FOR EDUCATIONAL DEVELOPMENT Dean: Rubens Mario Alberto Wachholz Established in 2003, IDE aims to develop executive education programs that respond to the challenges of an ever-changing market. The area combines the expertise of FGV schools and research centers with the innovation and practical insight required for all levels of a professional career. The institute is composed of the following areas: Board of Directors of the Rio de Janeiro and Brasilia Nuclei, Board of Directors of the Sao Paulo Nucleus, Board of Directors of the Agreement Network, Board of Directors of Academic Management, Planning, Control and Information, Quality Certification Program, Superintendent of Services, and Superintendent of Business Architecture. With a nationwide presence and a varied portfolio, IDE offers courses in the in-person, distance, blended and customized modes, including short- and medium-term MBA courses, as well as several others. 0 IN 2018 • • . Achievement of the "Marco Maciel Award: Ethics and Transparency be- tween the Public and the Private". Achievement of the "Top of Mind HR" Award (e-learning category) for FGV Online for the 13th consecutive time. Launch of new C-Level courses. 970,000 students enrolled and 523,000 declarations of completion issued in the free courses of FGV Online. • Over 79,000 students took the EDI executive education courses. • Present nationally in 114 municipalities. More information at fgv.br/educacao-executiva. -21° TOP OF MIND SILEI DACHING DER-2018 FGV representatives Rebecca Villagrán Seoane and Kelly Barros at the "Top of Mind HR Award" COACHING Techon IBC INSTITUTO BRASILEIRO DE COACHI Senior Decorangia para Gestão JTO 21 TO LEIRO DE ACHING >> Se Tecnolog IBC INST C MIN DEP TO EIRO DE CHING Tecnolog -21° TOP OF IBC INSTITUTO BRASILEIRO COACH Ser BRA CO IB MIND DERH 2018 The area combines the expertise of FGV schools and research centers with the innovation and practical insight required for all levels of a professional career. PREMIO MARCO MACIEL EDIÇÃO 2018 Categoria: Instituição de Ensino em RIG Abrig Marco Maciel Award: Ethics and Transparency between the Public and the Private Annual Report 2018 81 EDUCATION#4382 IDT Building IDT Auditorium IDT INSTITUTE FOR TECHNOLOGICAL DEVELOPMENT Dean: Flavio Vasconcelos The Institute for Technological Development was established in 2018, aiming to offer courses to professionals wishing to learn about new management tools and techniques and who seek the rapid application of their learning in the labor market. It features a faculty working in the areas of the subjects that they teach and who are qualified to work in distance education. It offers undergraduate technology courses in Business Management, Fi- nancial Management, Management Processes, Public Management, and Mar- keting. IDT features a faculty working in the areas of the subjects that they teach and who are qualified to work in distance education. IN 2018 Accreditation with top score by the Ministry of Education (MEC). . 1,005 undergraduate students. More information at fgv.br/graduacao-tecnologica. FGV Annual Report 2018 83 EDUCATION#4484 RI SCHOOL OF INTERNATIONAL RELATIONS Dean: Celso Castro The School of International Relations offers a study program for those who are interested in pursuing global careers and, therefore, need to acquire professional skills and competencies for internationalized work environments. The training includes the development of analytical capability, coupled with a solid track record of data science methods and courses. The school uses a unique methodology, which combines academic rigor and practical training, as well as offering opportunities for exchange, immer- sion and internship abroad during the course. It offers undergraduate courses in Sao Paulo and lato sensu graduate cours- es in Sao Paulo, Rio de Janeiro, and Brasilia. IN 2018 • Launch of the undergraduate course in International Relations. • Opening of the 11th class of the MBA in International Relations in Rio de Janeiro, the 6th class of the program in Sao Paulo, and the 2nd in Brasilia. More information at fgv.br/ri. Presentation of the new undergraduate course in International Relations at the FGV 9 de Julho Auditorium FGV ESCOLA DE RELAÇÕES INTERNACIONAIS The school uses a unique methodology, which combines academic rigor and practical training. FGV RI XFOV Annual Report 2018 85 EDUCATION#4586 PRESS Director: Marieta de Moraes Ferreira Laurs Gonzater Mauricin de Almeida Prado ORGANIZACAO O BRASIL MUDOU MAIS DO QUE VOCÊ PENSA UM NOVO OLHAR SOBRE AS TRANSFORMAÇÕES NAS CLASSES CDE 1FGV EDITORA Established in 1974, the Press aims to publish and disseminate works from several fields of knowledge while collaborating to the improvement of education in Brazil. Its catalog covers areas such as: Administration, Economics, Law, Sociol- ogy, Philosophy, Political Science, and History, privileging and encouraging FGV's authors, as well as thinkers of the academic community from across Brazil and from abroad. Press is influential in the medium, always attending the most important book fairs in Brazil, such as the International Book Biennial. NOVAS MEDIDAS CONTRA A CORRUPÇÃO UNIDOS CONTRA CORRUPÇÃO FGV Press is influential in the medium, always attending the most important book fairs in Brazil, such as the International Book Biennial. VOLTA AO PODER Adelina Neseptic the Mec to indiceste Ansonia Cendido IN 2018 • Launches of books "Novas Medidas contra a corrupção" ("New Measures Against Corruption"), "Volta ao poder: a correspondência entre Getúlio Vargas e a filha Alzira" ("Back to Power: The Correspondence between Getúlio Vargas and His Daughter Alzira"), and "O Brasil mudou mais do que você pensa" ("Brazil Has Changed More Than You Think"). Implementation of e-book loaning in the FGV Library System. 87 published titles, including: - 6 new editions; - 43 new books; - 53 e-books; and - 38 reprints. Total of 78,073 copies. More information at: fgv.br/editora. Annual Report 2018 87 SERVICES, INDEXES AND PUBLICATIONS#4688 IBRE BRAZILIAN INSTITUTE OF ECONOMICS Director: Luiz Guilherme Schymura Established in 1951, IBRE has the mission of researching, analyzing, producing and disseminating high-quality macroeconomic statistics and applied economic research that are relevant to the improvement of public policies or private action in the Brazilian economy and which stimulate the country's economic development and social well-being. Its duties include the production of reference prices, studies and sector projections, in addition to the monthly collection of prices and economic data alongside partner companies. IN 2018 • Promotion of the series, in partnership with the newspaper Estadão, "Os Economistas das Eleições" ("The Economists of Elections"). Agreement with IPECE to prepare a tool to improve the public manage- ment of the state of Ceará. • Launch of the Inflation Website. • Leader in the FGV media exposure. Top 5 in macroeconomic projections on Bloomberg. • 2,222,851 prices surveyed in the year. • 80,160 survey questionnaires applied in the year. More information at fgv.br/ibre. Carlos Ivan Simonsen Leal, President of FGV, and Flávio Ataliba, Director-General of IPECE, at the signing of the agreement Inflation Website FGV BRE Its duties include the production of reference prices, studies and sector projections. Portal da inflação P Annual Report 2018 89 SERVICES, INDEXES AND PUBLICATIONS#47PROJETOS Director: Cesar Cunha Campos Projetos is the unit responsible for the generation and application of technical and academic knowledge produced in FGV schools and research institutes. THE ARMED FORCES AND FGV The Brazilian Armed Forces have continually improved their activities, promoting a major transformation of Defense and, subse- quently, the improvement of technological development for Brazil, with the construction of submarines (one with nuclear propulsion), corvettes, and cutting-edge fighter aircraft, as well as mastery of cybernetic means. FGV is a long-standing partner of the Armed Forces, with the goal of supporting them in such initiatives as: Advising public and private institutions for more than 30 years, Projetos works in the fields of Economics and Finance, Management and Administra- tion, Law, and Public Policy. The unit has expertise for solutions to strategic issues, aimed at the national and international development, relating to socio- economic issues, disseminating knowledge regarding Brazil's national devel- opment and its insertion in the globalized world. With offices in Rio de Janeiro, Sao Paulo and Cologne (Germany), the Pro- jetos area features a team of multidisciplinary professionals, with Master's and Doctoral degrees in the different fields of knowledge. With this team of re- nowned experts, in addition to FGV's academic staff, the unit is responsible for preparing important Technical Advisory, Applied Research, Examination and Educational Evaluation projects, Competitive Examinations, Certifications, Mediation, Seminars, Congresses, and Periodicals. In 2018, Projetos developed 124 Technical Advisory Projects in Brazil and abroad, 3 Examinations, in particular the National Secondary School Exam- ination (ENEM), and the Examination of the Brazilian Bar Association (OAB), 5 Competitive Examinations, 3 Evaluations, 2 Certifications, 5 Mediation Proj- ects, 30 Seminars and Congresses, including 8 abroad, and 12 Publications. More information at fgv.br/fgvprojetos. CCE Business Cooperation Committee President: João Carlos de Luca CEM World Economic Center Director: Carlos Geraldo Langoni The Business Cooperation Committee (CCE) was established in 1990 with the aim of discussing the implications for Brazil of the process of transforma- tion of the international economy. The CCE brings together representatives of the private sector to study, through the World Economic Center (CEM), different issues related to the competitive integration of Brazil as an emerging power in a dynamic and challenging external environment, taking advantage of the FGV's excellence as a think tank. Through the promotion of lectures, such as the seminar "Reavaliação do Risco Brasil" ("Reassessment of the Brazil Risk"), with the presence of the president of the Brazilian Central Bank Ilan Goldfajn, CEM discusses key issues such as opening the economy, financial and capital flows, country risk evolu- tion, innovation, and technology. Submarine Development Program The Submarine Development Program (PROSUB) was de- veloped in 2008 through an agreement for the transfer of tech- nology between Brazil and France and aims to protect the vast Brazilian natural heritage, ensuring the country's sovereignty at sea by means of investment in the maritime force and the development of the defense industry. At the invitation of the Brazilian Navy, FGV has participated in this initiative. The Naval Base of Itaguaí is a complex with 540,000 square meters in area, located in Sepetiba Bay, in the municipality of Itaguaí, Rio de Janeiro. The monitoring and inspection of the project and naval facilities were the responsibility of the Navy's Board of Civil Works (DOCM), and FGV was initially responsible for de- veloping and applying a project compliance analysis model and providing the advisory services on activities that included the strategic monitoring of projects and the training of technicians to apply the developed methodology. Continuing this partner- ship, FGV was requested to structure complementary work in support of PROSUB. The first submarine, named Riachuelo, was commissioned in December 2018, with the presence of the Pre- sident of the Republic of Brazil, the Minister of Defense, the Navy Commander, and other authorities. Surface Vessel Procurement Program The Surface Vessel Procurement Program (PROSUPER) is one of the priority programs of the Brazilian Navy and inclu- des escort ships, patrol ships, and a logistical support ship. The main action of PROSUPER was the Tamandaré Corvette Project (CCT), for the procurement of four escort ships, and FGV was hired to provide support for the project. In December 2017, a Request for Proposal (RFP) was launched aiming at the procu- rement, via construction, of the first four CCTs. In June 2018, the Short List was announced, contemplating the consortia that will be submitting final proposals in 2019. Brazilian Multipurpose Reactor Project The Brazilian Multipurpose Reactor (RMB) project aims to pro- vide Brazil with a strategic infrastructure for the national develop- ment of nuclear sector activities in the fields of social applications, electricity generation, and naval propulsion. FGV was contracted to prepare a study aiming at the formulation of a self-sustaining business model for the operation of the RMB. Ammunition Factory The Brazilian Navy's Fábrica Almirante Jurandyr da Cos- ta Müller de Campos produces all medium and large-caliber ammunition employed by the Navy. FGV developed an analysis study for EMGEPRON, with the strategies for the development of the factory. Research and Development . The FGV carries out technical advisory project to expand the research and development of Military Science at the Army Command and General Staff School (ECEME). Since 2001, ECEME has been conducting its Graduate Program in Military Science. FGV signed a cooperation agreement with the University of the Air Force (UNIFA) to share research, provide tech- nical advisory services to the academic organization, and deliver courses in strategic management and processes. UNIFA aims to promote the development of Aerospace Science and to train, at the cultural and professional level, the military and civilians of the Aeronautics Command. Training and Improvement Executive MBA in Administration, Policy and Strategy Since 1999, FGV has developed the Executive MBA in Ad- ministration, Policy and Strategy in partnership with ECEME. The one-year program is targeted at selected colonels and aims to train military managers to address the organizational and administrative challenges posed by their duties and to enab- le officers to advise the highest ranks of the Armed Forces of the Ministry of Defense and Bodies of the Executive Branch. The program has already trained more than 750 officers, 112 of whom have been promoted to Generals. In addition, MBA gra- duates have contributed over time to important strategic areas of government, assuming prominent roles as ministers and se- cretaries in various areas of the formulation and implementa- tion of public policy in Brazil. International MBA in Political and Strategic Studies Since 2015, FGV has developed an Executive MBA course for senior officers of the Brazilian Army and friendly countries, most of which have stricto sensu (Master's and doctorate) pos- tgraduate degrees, in partnership with ECEME. This course, which provides the degree "Executive MBA in Business Admi- nistration: Political and Strategic Studies," is entirely developed in English and has trained, to date, senior officials from 23 coun- tries. In 2019, it will be attended by members of the Armed For- ces of Cameroon, Canada, Colombia, India, Iran, Japan, Portugal, Uruguay, and the United Kingdom. The course thus contributes to the country's strategic actions for international insertion, by increasing Brazil's participation and projecting its image abroad. Entrepreneurship course at the undergraduate and graduate level A Memorandum of Understanding signed in 2015 betwe- en the Military Engineering Institute (IME) and FGV has enab- led the exchange of professors, joint promotion of events, and research activities on topics of common interest, resulting in numerous common courses and integrated activities. In parti- cular, many IME students have attended classes and seminars at various FGV schools, and IME teachers have lectured on the FGV network. Additionally, since 2016, FGV has developed the Entrepreneurship, Public Sector and Private Sector course alon- gside IME. It is taught to mixed classes with students from both institutions. There is a combination of the technological capa- bilities of the IME students and the administrative capacities of the FGV students. Startup projects have been presented annu- ally to an audience of potential investors. Executive MBA: Strategic Planning and Management FGV carries out, alongside the Air Force Command and Ge- neral Staff School (ECEMAR), the Executive MBA in Strategic Planning and Management, as part of the training process of the command officers of the Brazilian Air Force (FAB). The pro- ject covers the entire national territory, online, with 171 students. 90 Annual Report 2018 91 SERVICES, INDEXES AND PUBLICATIONS#48DCI Internal Control Division Director: Maria Alice da Justa Lemos Established in 2016, DCI is the unit responsible for implementing and mon- itoring the FGV Internal Control and Compliance System. This board aims to promote efficiency and effectiveness of management through the achieve- ment of strategic objectives and risk management, as well as ensuring compli- ance with applicable laws and regulations. RESEARCH NETWORK Research and Applied Knowledge Network Director: Goret Pereira Paulo The Research Network was established in 2016 with the aim of encouraging the development of applied research with excellence, high impact and high degree of innovation, thereby collaborating with the institution's mission. To achieve this goal, the unit has approached the research activities of the public and private sectors and encouraged the formation of research networks in Brazil and abroad. The Research Network also contributes to the dissemina- tion of knowledge produced by FGV schools and research centers. DICOM Communications and Marketing Division Director: Marcos Henrique Facó DICOM is the area responsible for communication and marketing at Fundação Getulio Vargas, addressing the solidity of the FGV brand and main- taining its credibility with the internal and external publics. Its mission is to strengthen its identity in Brazil and abroad, positioning it as a synonym of tradition, innovation, pioneerism, developmentalism, reference, and technique. DO Division of Operations Director: Mario Rocha Souza The Division of Operations is responsible for asset management, informa- tion technology, and academic registration. SB FGV Library System Director: Marieta de Moraes Ferreira The main goal of SB - FGV Library System is to promote the integration, modernization and innovation of the institution's libraries, as well as the syn- ergy between these libraries and FGV units, with an emphasis on the training and qualification of the academic collection. Established in 2012, it comprises the libraries Mario Henrique Simonsen (BMHS), located in Rio de Janeiro; Karl A. Boedecker (BKAB), in Sao Paulo; the Brasilia Library; and the Digital Library. The System also includes, as permanent actions, the creation of policies that facilitate the modus operandi of researchers and students regarding bib- liographic research, as well as the valuation and expansion of FGV's produc- tion and academic memory, increasing the visibility of the researchers. More information at fgv.br/bibliotecas. DRH Human Resources Division Director: Luiz Carlos Ranna DRH's duties are to advise Senior Management with information that assists in making strategic and managerial decisions, contributing to the integration between the areas of the institution and developing activities that add new values in the search for training, development and well-being of its employees, as well as the management of their records. With that, it seeks to ensure the confidentiality of processes and information, maintain excellence in service and ensure the satisfaction of internal and external customers. CONTROLLERSHIP SUPERINTENDENT'S OFFICE Superintendent: Jacques Maidantchik Junior The Controller's Department is FGV's area responsible for providing accu- rate and timely financial information to the organization's managers, collabo- rating to the effectiveness of its decisions in financial and economic aspects. PROVOST OFFICE Director: Antonio de Araújo Freitas Junior The Provost Office aims to guide schools on subjects related to regula- tion, academic management and the use of new technologies, in addition to keeping the FGV Senior Management up to date on national and international regulatory demands in the fields of teaching, research, and graduate studies. The area is also responsible for monitoring the academic performance and promoting synergy between schools, their researchers, and, especially, net- work programs. TREASURY Treasurer: Jorge Ricardo Ferreira Guilherme FGV's Treasury is the body responsible for moving and controlling the integrity of the institution's checking accounts and financial investments, in line with the deliberations of the President and the Board of Directors of FGV, and by coordinating the activities of accounts receivable, payments, and delinquency. 92 Annual Report 2018 93 GENERAL ADMINISTRATION#49CHAMBER FGV Mediation & Arbitration Chamber Director: Julian Chacel Based on Act 9,307/96, which renews institutional arbitration in Brazil, FGV has established an Arbitration Chamber, whose main duty is to manage and monitor the arbitration procedure, ensuring that all phases and deadlines are fulfilled in accordance with the law. Additionally, a new duty of the Chamber is mediation, which provides for an agreement between the parties in conflict with the assistance of a third party. The mediation phase may precede arbitra- tion and, in the event that the agreement is accepted by the parties, arbitra- tion becomes unnecessary. Chaired by the President of FGV, the Board includes two Directors, as well as a Chairman of the Arbitration Committee, as provided in the regulations, and a permanent body of arbitrators composed of persons of renowned tech- nical ability and unimpaired reputation, as well as professors from FGV in the fields of Law, Economics, and Administration. In 2018, the Chamber was empowered by the Public Prosecutor's Office to manage arbitrations in which the State of Rio de Janeiro is a party. More information at fgv.br/camara. CDMC Center for the Development of Mathematics and Science Director: César Camacho Established in 2017, CDMC was created with the mission of identifying you- ng medalists of the Brazilian Math Olympiads for Public Schools (OBMEP), among other national Math Olympiads, and coming from Brazilian public schools, in particular non-selective public schools, with the aim of encoura- ging them to pursuing undergraduate and graduate studies at FGV, in order to enrich the staff of scientists and professionals in advanced education that the country needs. It also aims to map non-selective public schools of excellence, as revealed by the performance indices of the Ministry of Education (MEC) and in the Knowledge Olympiads, in order to contribute to the training of their teachers, improvement of school management, and preparation of students. In 2018, CDMC was able to recruit more than 100 participants to the FGV Entrance Examination, selected from the national Math Olympiads. CERI Center for Regulation and Infrastructure Studies Director: Joisa Campanher Dutra CERI produces applied research for the development of infrastructure services in Brazil. To achieve this goal, it has a multidisciplinary team that actively contributes to generating and disseminating knowledge on topics relevant to the advancement of the sectors of energy, transportation and lo- gistics, urban mobility, water, and sanitation, among others. These industries are monitored and analyzed especially under the dimensions of regulation, governan- ce, long-term financing and risk allocation, modeling of concessions, and public- -private partnerships. The center also has national and international partners such as the regulatory agencies, the World Bank, the Inter-American Development Bank, and the Florence School of Regulation. In 2018, CERI was acknowledged with the award for best regulatory work at the National Seminar for the Distribution of Electric Energy - SENDI 2018. More information at fgv.br/ceri. GROWTH AND DEVELOPMENT Center for Growth and Economic Development Studies Directors: João Victor Issler and Pedro Cavalcanti Ferreira Growth and Development is a center at FGV dedicated to studies in the field of growth and economic development and natural resources. His research privileges the Brazilian economy, based on theoretical knowledge and accumulated experien- ces, especially in the last two decades, using comparisons with successful examples of developed and emerging economies. During the year 2018, the center focused on disseminating, to the media and the general public, important ideas for the country's growth, many of which originated in the research of its members, publication of its research, and development of new research. In the periods, the center has published more than 20 articles in the mains- tream press, as well as a number of interviews and academic articles in books and periodicals on central topics for development and well-being. During the year, the center expanded its scope with the creation of the FGV- nest Nucleus for Startup, Innovation, Venture Capital and Private Equity Studies, - a pioneering initiative that aims to actively contribute to the country's high-impact entrepreneurial ecosystem. More information at fgv.br/crescimento. DAPP Department of Public Policy Analysis Director: Marco Aurelio Ruediger The Department of Public Policy Analysis is an applied social research center pioneering in the development of methodologies for political analysis and public policies through social networks and information technologies. The unit's mission is to promote accountability of public policies and their effects, contributing to trans- parency and public debate in a networked society and reinforcing the dialogue be- tween the State and society. In 2018, the center played a key role in the 2018 elections, having created the Di- gital Democracy Room, which monitored public debate on social networks. More information at fgv.br/dapp. 94 Annual Report 2018 95 SPECIAL PROGRAMS#50DGPE Center for the Development of Public Management and Educational Policies Director: Henrique Paim Established in 2018, DGPE aims to promote the development of municipality management, as well as supporting educational systems in improving educational management, in line with the mission of Fundação Getulio Vargas to promote the economic and social development of Brazil. In the year, the center developed important projects, one of their highlights being the advisory of the construction of the "Curricular Document of the Mara- nhão Territory for Early Childhood Education and Primary Education." This process was planned by different stakeholders, such as managers and technicians from the State Education Secretariat (SEDUC-MA), the National Union of Municipal Educa- tion Directors (UNDIME-MA), the State Council of Education (CEE-MA), and the National Union of Municipal Education Councils (UNCME-MA), with the technical support of DGPE. Also, in 2018, the center was hired by the Inter-American Development Bank (IDB) to develop two studies that will analyze the Integrated Education Manage- ment System (SIGEDS) solutions at the primary level (kindergarten, pre-school, primary education, and secondary education), available in the market. It will also analyze the operation, level of development, strengths and challenges, critical path and estimated costs to strengthen the SIGEDS of the state of Espírito Santo, the municipality of Florianópolis, and the province of Cordoba (Argentina). This work is part of a study conducted by IDB across Latin America and the Caribbean, with FGV being responsible for its application in Brazil and Argentina. tics, Law, and Social Sciences. Its goal is to foster FGV's strategic positioning in the field of energy, strengthening its recognition as one of the leading think tanks in the sector. In 2018, the center prepared several projects such as: R&D in Technology Road- map and the international event "Houston Brazilian Meetup," OTC 2018. More information at fgv.br/fgvenergia. NPII International Intelligence Unit Director: Renato Galvão Flôres Junior NPII aims to produce content on issues that always involve an international di- mension, with the aim of opening markets and partnerships abroad for FGV, as well as bringing smart solutions, ideas and investments from abroad to the Brazil. The unit generates knowledge on important or current international issues con- sidered essential for Brazilian interests. It consists of a lean unit, with a small team of technicians - approximately half of which are of international origin - and a group of high-level special consultants, including senior executives, ambassadors, former ministers of state, and directors of large public-service corporations. In 2018, it promoted and participated in important events, such as the interna- tional conference of the FGV IIU Jean Monnet Network on Atlantic Studies in Rio de Janeiro, Brazil, and the opening of the Paris Peace Forum, during the celebrations of the armistice in Paris, France. More information at fgv.br/iiu. DINT International Affairs Division Director: Bianor Scelza Cavalcanti Established in 2009, DINT's mission is to support the internationalization stra- tegy of Fundação Getulio Vargas, with the aim of contributing to the recognition of the institution as a benchmark in teaching and a global think tank. Its objectives include the prospecting, mapping, orientation, recommendation and use of oppor- tunities in various places in the world that are prioritized by the President and in subsidiary support to the other units of the institution. In 2018, DINT had important initiatives, such as the coordination of the G20 think tank. More information at fgv.br/dint. ENERGY Center for Energy Studies Director: Carlos Otavio de Vasconcellos Quintella Established in 2013, Energy - Fundação Getulio Vargas' Center for Energy Stu- dies - aims to broaden knowledge on energy issues in an interdisciplinary manner, in the fields of Public and Business Administration, Economics, Applied Mathema- SOCIAL Center for Social Policy Director: Marcelo Neri The Center for Social Policy seeks to contribute to inclusive Brazilian develop- ment, connecting research applied to the debate in society and the implementation of public policies. Approaching in an integrated way the most important social topi- cs of the Brazilian scenario, it works for the diffusion of knowledge and inspiration of new inclusive practices. The unit offers training and specialized advice for projects in different areas of operation, in partnership with government entities, companies, and civil society organizations, located in Brazil and abroad. Through empirical research, especially based on large databases of public micro- data and through the design and evaluation of public policies, the center believes that it can identify and promote new transformations in society. The approach aligns several stakeholders and instruments of action in order to holistically enhance diffe- rent dimensions of the population's life. In 2018, the center obtained recognition through the award granted to director Marcelo Neri by Instituto Trata Brasil. More information at fgv.br/fgvsocial. 96 Annual Report 2018 97 SPECIAL PROGRAMS#51INTERDISCIPLINARY CENTERS CEPESP - Center of Politics and Economics of the Public Sector (2006) Coordination: George Avelino Filho *Center connected to FGV EAESP, FGV EESP and FGV EBAPE FGVcemif- Center for Microfinance Studies and Financial Inclusion (2007) Coordination: Lauro Emilio Gonzalez Farias *Center connected to FGV EAESP and FGV EESP NFC - Center for Behavioral Finance (2014) Coordination: William Eid and Ricardo Ratner Rochman *Center connected to the Center for Financial Studies of FGV EAESP and FGV EESP LHuD - Digital Humanities Lab (2016) Coordination: shared by all team members Audiovisual and Documentary Center (2006) Coordination: Adelina Novaes Cruz, Arbel Griner and Thaís Blank Direito Rio - Rio de Janeiro Law School CJUS Center for Justice and Society (2004) Coordination: Michael Freitas Mohallem CPDE- Center for Research in Law and Economics (2009) Coordination: Antônio José Maristrello Porto Nucleus for Advanced Studies in Regulation of the Financial System (2018) Coordination: Antônio José Maristrello Porto Brazil-China Program (2017) Coordination: Evandro Menezes de Carvalho PDMA Law and Environment Program (2009) Coordination: Antônio José Maristrello Porto CTS - Center for Technology and Society (2003) Coordination: Ivar Alberto G. M. Lange Hartmann (interim) INTRADISCIPLINARY CENTERS CPDOC - School of Social Sciences FGV's Center for International Relations (2009) Coordination: Matias Spektor FGV Opinião - Center for Applied Social Research (2000) Coordination: Márcio Grijó Vilarouca LAPES - Laboratory for Social Thought (2008) Coordination: João Marcelo Ehlert Maia and Bernardo Buarque de Hollanda LECV- Laboratory for Visual Culture Studies (2018) Coordination: Thais Blank LEER - Laboratory for Ethnic-Racial Studies (2017) Coordination: Ynaê Lopes dos Santos LEH - Laboratory for Teaching History (2013) Coordination: Américo Freire, Martina Spohr Gonçalves, Vivian Fonseca and Ynaê Santos LEI - Laboratory for the study of Institutions (2014) Coordination: Angela Moreira Domingues da Silva, Letícia Ferreira and Marco Aurélio Vannucchi LEM - Laboratory for Studies of the Military (2010) Coordination: Celso Castro LEP - Laboratory for Political Studies (2009) Coordination: Américo Freire and Márcio Grijó Vilarouca LESP - Laboratory for Sports Studies (2013) Coordination: Bernardo Buarque de Hollanda, Jimmy Medeiros and Vivian Fonseca LET - Laboratory for Tourism Studies (2008) Coordination: Celso Castro 98 Annual Report 2018 99 STUDY CENTERS#52Direito SP - Sao Paulo Law School Human Rights and Business Research Group (2013) Coordination: Flávia Scabin Law and Innovation Research Group (2012) Coordination: Marina Feferbaum and Alexandre Pacheco Law, Gender and Identity Research Group (2011) Coordination: Ligia Pinto Sica Public Group (2017) Coordination: Carlos Ari Sundfeld Nucleus for Business Law of the Professional Master's Degree (2014) Coordination: Mario Engler and Osny da Silva Filho Nucleus for Law, Economics and Governance (2013) Coordination: Mariana Pargendler and Bruno Meyerhof Salama Nucleus for Global Law and Development (2008) Coordination: Michelle Ratton and Salem Nasser Nucleus for Economic Criminal Law of the Professional Master's Degree (2012) Coordination: Heloisa Estellita Nucleus for Tax Law of the Professional Master's Degree (2014) Coordination: Tathiane Piscitelli Nucleus for Fiscal Studies (2009) Coordination: Eurico Marcos Diniz De Santi Nucleus for Market and Investment Studies (2012) Coordination: Ary Oswaldo Mattos Filho and Viviane Muller Prado Nucleus for Crime and Punishment Studies (2005) Coordination: Maíra Rocha Machado and Marta Machado FGVcelog - Center for Excellence in Logistics and Supply Chain (2005) Coordination: Priscila Laczynski S. Miguel FGVcenn - Center for Entrepreneurship and New Ventures (2004) Coordination: Edgard Roger Barki FGVcepe - Private Equity Research Center (2003) Coordination: Newton Monteiro de Campos Neto FGVces - Center for Sustainability Studies (2003) Coordination: Mário Monzoni FGVcev - Center for Retailing Excellence (2001) Coordination: Maurício Morgado FGVcia - Center for Applied Information Technology (1992) Coordination: Alberto Albertin FGVethics - Center for Ethics, Transparency, Integrity and Compliance Studies (2019) Coordination: Ligia Maura Costa FGVredes - Center for Communication, Marketing and Social Networks (2012) Coordination: Eliane Pereira Zamith Brito FGVsaúde - Center for Health Planning and Management Studies (1989) Coordination: Ana Maria Malik Finance Institute (2012) Coordination: João Carlos Douat NEOP - Center for Organization and People Studies (2012) Coordination: Maria José Tonelli Nucleus for Justice and Constitutional Affairs (2010) Coordination: Dimitri Dimoulis and Luciana Gross Cunha EAESP-Sao Paulo School of Business Administration CEAPG - Center for Public Administration and Government Studies (1989) Coordination: Fernando Burgos Innovation Center (2000) Coordination: Susana Carla Farias Pereira CND - Center for Studies on New Developmentalism (2005) Coordination: Nelson Marconi FGVcef - Center for Financial Studies (2002) Coordination: William Eid Júnior FGVcei - Center for International Competitiveness Studies (2014) Coordination: Maria Tereza Leme Fleury EBAPE - Brazilian School of Public and Business Administration CBFR 2 - Center for Banking and Finance Research in Rio (2016) Coordination: Patrick Behr and Lars Norden CBR - Center for Behavioral Research (2013) Coordination: Eduardo Andrade CEIPE - Center for Excellence and Innovation in Education Policies (2016) Coordination: Claudia Costin C-MICRO - EESP - Sao Paulo School of Economics Center for Applied Microeconomic Studies (2009) Coordination: André Portela Fernandes de Souza CLEAR - Center for Learning on Evaluation and Results for Brazil and Lusophone Africa (2015) Coordination: Lycia Lima LEARN - Lab for Evaluation, Analysis and Research in Learning (2014) Coordination: Vladimir Pinheiro Ponczek 100 Annual Report 2018 101 STUDY CENTERS#53• CCGI - Center for Studies in Global Trade and Investments (2010) Coordination: Vera Thorstensen • Center for Modeling (2010) Coordination: Lucas Ferraz CEAS - Center for South Atlantic Studies (2014) Coordination: Luiz Felipe de Alencastro CEMAP - Center for Applied Macroeconomic Studies (2004) Coordination: Emerson Fernandes Marçal • Nucleus of the Foreign Exchange and Trade Observatory (2012) Coordination: Emerson Fernandes Marçal Center for Macroeconomic Research on Brazil (2013) Coordination: Marcelo Kfoury Muinhos CEQEF - Center of Quantitative Studies in Economics and Finance (2008) Coordination: Pedro Luiz Valls Pereira FGV Agro - Center for Agribusiness Studies (2003) Coordination: Roberto Rodrigues State Observatory (2017) Coordination: Márcio Holland EPGE - EPGE Brazilian School of Economics and Finance CEA - Center for Applied Economics (2002) Coordination: Aloisio Araújo IBRE - Brazilian Institute of Economics Applied Economics (2010) Coordination: Armando Castelar Pinheiro • Growth and Economic Development Coordination: Fernando Augusto Adeodato Veloso, Armando Castelar, Samuel Pessôa and Nelson Barbosa • External Sector Studies Coordination: Lia Valls Pereira Monetary Studies Coordination: José Júlio Senna Infrastructure Coordination: Armando Castelar • Labor market 102 Coordination: Fernando de Holanda Barbosa Filho Fiscal Policy Coordination: José Roberto Rodrigues Afonso Macroeconomic Forecasts and Studies Coordination: Silvia Maria Matos Annual Report 2018 103 STUDY CENTERS#54INTERNATIONAL#55Canada | 12 United States of America | 51 106 HIGHER EDUCATION INSTITUTION PARTNERS Colombia | 1 Peru | 3 Ecuador | 1 Tijuca Av. Brasil Jd. Botânico Chile | 3 Mexico | 4 Finland | 1 Norway | 2 Denmark | 2 Sweden | 3 Germany | 23 Belgium | 3 Netherlands | 5 Switzerland | 3 United Kingdom | 14 Ireland | 1 France | 21 Spain | 10 Italy | 10 Venezuela | 1 Portugal | 6 Argentina | 4 South Africa | 1 Poland | 3 Hungary | 1 Czech Republic | 1 Austria | 2 Turkey | 3 Israel | 2 India | 7 Singapore | 2 Source: International Affairs Division (FGV DINT) China | 9 Do Russia | 3 Japan | 4 South Korea | 4 Taiwan | 1 Australia | 3 New Zealand | 2 Annual Report 2018 107 INTERNATIONAL#56ARGENTINA Universidad Austral Universidad de San Andrés Universidad Nacional de San Martín Universidad Torcuato Di Tella AUSTRALIA Macquaire University University of New South Wales University of Sidney Chinese Academy of Social Sciences - CASS FUDAN University - BRICS Studies Center Peking University School of Transnational Law Renmin University The Hong Kong University of Science and Technology Tsinghua University Xiamen University COLOMBIA Universidad Los Andes Université d'Auvergne Université Paris Dauphine - Université Paris - Sorbonne Université Paris 2 Panthéon-Assas Université Toulouse 1 Capitole University of Strasbourg Indian Institute of Management Ahmedabad IIMA Indian Institute of Management Bangalore IIMB Indian Institute of Management Calcutta IIMC Institute for Defence Studies and Analyses (New Delhi) Jindal Global Law School AUSTRIA IMC University of Applied Science Krems Vienna University of Economics and Business BELGIUM Université Catholique de Louvain Université Libre de Bruxellas University of Antwerp - School of Law CANADA HEC Montreal McGill University Queen's University Université du Québec à Montréal Université Laval University of British Columbia University of Calgary University of Manitoba University of Montreal University of Victoria - Peter B. Gustavson School of Business University of Western Ontario York University CHILE Pontificia Universidad Catolica de Chile Universidad Adolfo Ibañez Universidad de Chile CZECH REPUBLIC University of Economics, Prague DENMARK Copenhagen Business School CBS University of Copenhagen ECUADOR Universidad Andina Simon Bolivar FINLAND Aalto University FRANCE Ecole Nationale d'Administration (ENA) École supérieure de commerce de Pau - ESC PAU EDHEC Business School EM Lyon ESCP Europe ESSEC Business School Grenoble École de Management HEC Paris School of Management Institut National de Recherche en Informatique et en Automatique (INRIA) Montpellier Business School NEOMA Business School GERMANY Albert Ludwigs Universität Freiburg Bucerius Law School - Hochschule fur Rechtswissenschaft EBS Universitat fur Wirtschaft und Recht Frankfurt School of Finance and Management Freie Universität Berlin German Institut of Global and Area Studies Global Public Policy Institute Hamburg School of Business Administration Hertie School of Governance Institute for Law and Finance - ILF Johannes Gutenberg University Mainz Julius Maximilian University of Würzburg Kühne Logistics University Mannheim Business School Max Planck Institute Pforzheim University Reutlingen University TUM Technische Universität München Universität Hamburg Universität Mannheim Universität zu-Köln Westfälische Wilhelms-Universität (Münster University) WHU Koblenz HUNGARY Corvinus University of Budapest CHINA Beijing Normal University China University of Political Science and Law Sciences Po Lille Sciences Po Lyon Sciences Po Paris Toulouse Business School (TBS) INDIA Embaixada da Índia no Brasil Indian Council of Cultural Relations ICCR IRELAND University College Dublin - Michael Smurfit Graduate Business School ISRAEL IDC Herzliya Radzyner School of Law - Tel Aviv University ITALY Fondazione Bruno Visentini International University College of Turin Libera Università Internazionale degli Studi Sociali Guido Carli (LUISS) Machiavelli Center for Cold War Studies, Universidade de Florença Università Cattolica del Sacro Cuore (UCSC) Universitá Commerciale Luigi Bocconi Università degli Studi di Roma "Tor Vergata" Universitá Degli Studi di Salerno Università Degli Studi di Torino Università di Pavia JAPAN Hiroshima University of Economics Keio University Nagoya University The University of Tokyo - CIDE MEXICO Centro de Investigación y Docencia Económicas El Colegio de México ITAM - Instituto Tecnológico Autónomo de México ITESM - Instituto Tecnológico y de Estudios Superiores de Monterrey 108 Annual Report 2018 109 INTERNATIONAL#57Lancaster University London Business School London School of Economics and Political Science NETHERLANDS Erasmus Universiteit Rotterdam Tilburg University Universität Maastricht Universiteit van Amsterdam Utrech University SOUTH AFRICA University of Cape Town GSB UCT SOUTH KOREA Korea University The University of Manchester Ministério de Relações Exteriores da República da Coreia NEW ZEALAND University of Auckland University of Otago NORWAY BI Norwegian School of Management Norwegian School of Economics - NHH PERU Universidad ESAN Universidad Nacional Mayor de San Marcos Universidad San Ignacio de Loyola POLAND Polish Institute of International Affairs SWPS University of Social Sciences and Humanities Warsaw School of Economics Sungkyunkwan University Business School Yonsei University School of Business SPAIN ESADE IE Business School Universidad Autónoma de Madrid Universidad Carlos III de Madrid Universidad Complutense de Madrid Universidad de Cantabria Universidad Francisco di Victoria Universitat Autónoma de Barcelona (UAB) Universitat Politècnica de Catalunya - Barcelona Tech Universitat Pompeu Fabra PORTUGAL Instituto Universitário de Lisboa - ISCTE Universidade Católica Portuguesa Lisboa Universidade Católica Portuguesa Porto Universidade de Coimbra Universidade de Lisboa Universidade Nova de Lisboa SWEDEN Stockholm School of Economics Stockholm University Umea Universitet SWITZERLAND EU Business School University of St. Gallen ZHAW School of Management and Law Regent's University London The University of Warwick The University of York University College London (UCL) University of Birmingham University of Bristol University of Edinburgh University of Essex UNITED STATES OF AMERICA ABCI Institute American University Arizona State University Babson College Boston University Brandeis University - BYU Brigham Young University Carnegie Endowment for International Peace Columbia University Cornell University Penn State Law Pepperdine University Purdue University San Diego State University Texas A & M The University of Chicago The University of Illinois The University of North Carolina at Chapel Hill The University of Texas at Austin The William and Flora Hewlett Foundation Tulane University University of California, Berkeley University of California, Davis University of California, San Diego University of Florida University of Miami University of Minnesota University of San Diego University of South Carolina University of Southern California University of Virginia - McIntire School of Commerce University of Wisconsin - Law School Vanderbilt University Woodrow Wilson International Center for Scholars Yale University TURKEY RUSSIA MIGMO Moscow State Institute of International Relations National Research University - Higher School of Economics St. Petersburg State University TAIWAN National Chengchi University Taiwan Bilkent University SINGAPORE National University of Singapore Singapore Management University - SMU Koç University Yasar University UNITED KINGDOM Cranfield University King's College London Duke University Emory University Florida International University Fordham University - School of Law Georgetown University Georgia Institute of Technology Global Centre for the Responsibility to Protect Gonzaga University - School of Law Harvard Law School Indiana University Massachusetts Institute of Technology (MIT) Michigan State University New York University Northeastern University Northwestern University Pace Law School - Pace University VENEZUELA IESA - Instituto de Estudios Superiores de Administración 110 Annual Report 2018 111 INTERNATIONAL#58ORGANIZATIONAL STRUCTURE#59Higher Administration Senior Management FIRST PRESIDENT AND FOUNDER Luiz Simões Lopes (1944-1992) SECOND PRESIDENT Jorge Oscar de Mello Flôres (1992-2000) PRESIDENT Carlos Ivan Simonsen Leal (2000-...) VICE PRESIDENTS Sergio Franklin Quintella Francisco Oswaldo Neves Dornelles (licentiate) Marcos Cintra Cavalcanti de Albuquerque (licentiate) PROVOST OFFICE Antonio de Araújo Freitas Junior BOARD OF DIRECTORS Members Armando Klabin Carlos Alberto Pires de Carvalho e Albuquerque Cristiano Buarque Franco Neto Ernane Galvêas José Luiz Miranda Lindolpho de Carvalho Dias Marcílio Marques Moreira Roberto Paulo Cezar de Andrade Substitutes Aldo Floris Antonio Monteiro de Castro Filho Ary Oswaldo Mattos Filho Eduardo Baptista Vianna Gilberto Duarte Prado Jacob Palis Júnior José Ermírio de Moraes Neto Marcelo José Basílio de Souza Marinho Mauricio Matos Peixoto BOARD OF TRUSTEES President Carlos Alberto Lenz Cesar Protásio Vice President João Alfredo Dias Lins (Klabin Irmãos & Cia.) Members Alexandre Koch Torres de Assis Liel Miranda (Souza Cruz S/A) Antonio Alberto Gouvêa Vieira Carlos Eduardo de Freitas (licentiate) Cid Heraclito de Queiroz Eduardo M. Krieger Estado da Bahia Estado do Rio de Janeiro Estado do Rio Grande do Sul José Carlos Cardoso (IRB-Brasil Resseguros S.A.) Luiz Chor Luiz Ildefonso Simões Lopes Marcelo Serfaty Marcio João de Andrade Fortes Miguel Pachá Murilo Portugal Filho (Brazilian Federation of Banks) Pedro Henrique Mariani Bittencourt Ronaldo Vilela (Union of Private Insurance, Complementary Pension and Capitalization Companies of the States of Rio de Janeiro and Espírito Santo) Willy Otto Jordan Neto Substitutes Luiz Guilherme Sá de Gusmão Carlos Hamilton Vasconcelos Araújo Joaquim Maia Brandão Júnior José Carlos Schmidt Murta Ribeiro Luiz Roberto Nascimento Silva Manoel Fernando Thompson Motta Filho Banco de Investimentos Crédit Suisse S.A. Olavo Monteiro de Carvalho (Monteiro Aranha Participações S.A.) Patrick de Larragoiti Lucas (Sul América Compa- nhia Nacional de Seguros) Ricardo Gattass Rui Barreto Sergio Lins Andrade EDUCATION CPDOC - School of Social Sciences Celso Castro Direito Rio - Rio de Janeiro Law School Sérgio Guerra Direito SP - Sao Paulo Law School Oscar Vilhena Vieira EAESP - Sao Paulo School of Business Administration Luiz Artur Ledur Brito EBAPE - Brazilian School of Public and Business Administration Flavio Vasconcelos EESP-Sao Paulo School of Economics Yoshiaki Nakano - EMAP School of Applied Mathematics César Camacho EPGE - EPGE Brazilian School of Economics and Finance Rubens Penha Cysne IDE - Institute for Educational Development Rubens Mario Alberto Wachholz IDT - Institute for Technological Development Flavio Vasconcelos RI - School of International Relations Celso Castro SERVICES, INDICES AND PUBLICATIONS Press Marieta de Moraes Ferreira IBRE - Brazilian Institute of Economics Luiz Guilherme Schymura Projetos Cesar Cunha Campos GENERAL ADMINISTRATION DCI - Internal Control Division Maria Alice da Justa Lemos DICOM - Communications and Marketing Division Marcos Henrique Facó DO Division of Operations Mario Rocha Souza DRH Human Resources Division Luiz Carlos Ranna Research Network - Research and Applied Knowledge Network Goret Pereira Paulo Library System Marieta de Moraes Ferreira Controllership Superintendent's Office Jacques Maidantchik Junior Treasury Jorge Ricardo Ferreira Guilherme Fundação Getulio Vargas Affairs Department - Sao Paulo Maria Tereza Fleury SPECIAL PROGRAMS Chamber Chamber - FGV Mediation & Arbitration Julian Chacel CDMC Center for the Development of Mathematics and Science César Camacho CERI - Center for Regulation and Infrastructure Studies Joisa Campanher Dutra Growth and Development - Center for Growth and Economic Development Studies João Victor Issler and Pedro Cavalcanti Ferreira DAPP - Department of Public Policy Analysis Marco Aurelio Ruediger DGPE - Center for the Development of Public Management and Educational Policies Henrique Paim DINT - International Affairs Division Bianor Scelza Cavalcanti - Energy Center for Energy Studies Carlos Otavio de Vasconcellos Quintella NPII - International Intelligence Unit Renato Galvão Flôres Junior Social - Center for Social Policy Marcelo Neri 114 Annual Report 2018 115 ORGANIZATIONAL STRUCTURE#60FINANCIAL STATEMENTS#61ASSETS BALANCE SHEETS FOR THE YEARS ENDED DECEMBER 31, 2018 AND 2017 - (IN MILLION BRAZILIAN REAIS) INCOME STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2018 AND 2017 - (IN MILLION BRAZILIAN REAIS) 2018 2017 CURRENT ASSETS CASH AND CASH EQUIVALENTS Unrestricted funds Restricted funds ACCOUNTS RECEIVABLE LOAN REPAYMENT 937.30 941.15 726.49 739.43 TOTAL LIABILITIES & EQUITY COST OF SERVICES PROVIDED 663.60 724.13 GROSS RESULT 2018 2017 1,266.08 (925.95) 340.13 1,122.21 (847.13) 275.08 62.89 15.30 109.73 96.78 ADMINISTRATIVE EXPENSES (381.99) (391.95) 30.87 30.10 Personnel Expenses (178.04) (173.74) INVENTORY 4.57 4.28 General and Administrative Expenses (77.82) (78.93) EMPLOYEE ADVANCES 8.68 8.96 Contracted Services (76.99) (78.68) PURCHASING AND SERVICE ADVANCES 8.75 35.48 Other Administrative Expenses (49.14) (60.59) LEGAL AND LABOR DEPOSITS 12.93 12.99 OTHER REVENUES 8.02 0.01 OTHER RECEIVABLES 35.29 13.12 Revenue from Disposal of Goods 0.02 0.01 Reversal of Actuarial Provisions 8.00 NON-CURRENT ASSETS LONG-TERM ASSETS Restricted financial investments Loan repayment Legal deposits NET TANGIBLE AND INTANGIBLE ASSETS 684.42 632.98 213.39 188.50 INCOME BEFORE FINANCIAL INCOME AND EXPENSES (33.84) (116.87) 58.30 54.60 51.21 44.49 Financial Income 103.88 89.40 Financial Expenses 471.02 444.48 Tangible and intangible assets (-) Depreciation and amortization TOTAL ASSETS 622.32 568.30 SURPLUS (DEFICIT) IN FINANCIAL YEAR 48.68 (12.72) 78.81 (13.89) 2.12 (51.95) (151.30) (123.81) 1,621.72 1,574.13 LIABILITIES & EQUITY 2018 2017 LIABILITIES 273.01 219.91 LOANS AND GRANTS 14.76 15.44 SUPPLIERS 104.47 115.20 SALARIES PAYABLE, CONTRIBUTIONS AND DEDUCTIONS 37.66 33.84 OTHER PROVISIONS 40.06 38.97 AGREEMENTS AND CONTRACTS 62.12 15.39 UNEARNED REVENUE 6.42 OTHER AMOUNTS DUE 7.53 1.08 NON-CURRENT LIABILITIES 225.90 234.62 LOANS AND GRANTS 68.68 83.11 UNEARNED REVENUE 16.58 PROVISIONS FOR LABOR, CIVIL AND TAX RISKS 16.10 38.61 PENSION OBLIGATIONS TO PAY 105.03 90.53 POST-EMPLOYMENT BENEFIT PROVISION 19.52 22.37 EQUITY 1,122.80 1,119.61 EQUITY FUND 999.78 1,051.54 SPECIAL FUNDS 143.68 139.72 ACCUMULATED SURPLUS (DEFICIT) 2.12 (51.95) OTHER COMPREHENSIVE RESULTS (22.77) (19.70) TOTAL LIABILITIES & EQUITY 1,621.72 1,574.13 118 Annual Report 2018 119 FINANCIAL STATEMENTS#62FGV FUNDAÇÃO GETULIO VARGAS Praia de Botafogo, 190 22250 900 Rio de Janeiro/RJ 55 21 3799 4747 CREDITS: Coordination and Concept: Communications & Marketing Division (FGV DICOM) Communications & Marketing Director: Marcos Henrique Facó Communications & Design Coordinator: Henrique Rajão Content: Fernanda Rufino Graphic Design: Luciana Tazinazzo Support: Applied Research and Knowledge Network Collaboration: Camilla Espíndola, Eduardo Bittencourt and Tyago Bonifácio Translation: Agnieszka Adamowicz#63Empty