Brazil faces two very different economic models in Bolsonaro and Haddad

Brazil’s far-right candidate, Jair Bolsonaro, has won the first round of the country’s recent presidential elections. The former military captain won 46 percent of the vote, making him the favorite to become Brazil’s next president when the second round of voting takes place on October 28. He is up against Fernando Haddad of the Workers’ Party, which was in power from 2003-16, but has been mired in high-profile corruption scandals.

The rise of Mr. Bolsonaro marks an extreme shift in Brazilian politics. A great deal of focus has been on his controversial anti-establishment rhetoric and monstrous opinions. As well as having potentially dangerous politics, a Bolsonaro presidency would mark a significant shift for Brazil’s economy, too.

Much of Brazil’s recent history has been marked by a state-led economic strategy known as social-developmentalism. This is, broadly-speaking, Mr. Haddad and the Workers’ Party’s approach. It is focused on the potential of Brazil’s internal market, demand for natural resources, and developing internal demand through investment in infrastructure.

Mixed results

It cannot be said that the 13 years of PT government followed strict social-developmentalist rules. But it gave great importance to both public investment (federal investment grew by around 10.6 percent per year) and...