Notes on Dilma Rousseff's reform of the power sector and the coordinating dimension of state capacities

Abstract

This paper aims to analyze the institutional changes in the power sector carried out by Dilma Rousseff’s government, relating them to the wider political crisis that permeated its second term, leading to its overthrown in 2016. Mobilizing the literature on state capabilities, we seek to advance the discussion on coordination capacities as an explanatory element for the crisis. Rousseff sought to retake state intervention in the power sector, intending to displace the protagonism acquired over the previous years by private entrepreneurs, especially foreigners. This reform, however, was widely criticized, even by business groups benefiting from the reduction of electricity tariffs. Our hypothesis is that the problems in the coordinative dimension of state capacities led to the weakening of the ruling coalition born in 2003.