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On the determinants of capital costs in Brazil's manufacturing industries

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  • Dezséri, Kálmán

Abstract

The Brazilian economy has undergone profound changes since the early 1970s. During this time, the external and internal economic conditions significantly altered. The two oil shocks, changes of the interest rates on the international capital markets, the following debt crisis, terms of trade deterioration, soaring inflation rate, high external and public deficits are the uppermost phenomena which characterised the Brazilian economy. From the point of view of economic policy, it is very important that the stabilisation programs should be accompanied by a successful structural adjustment process. New investments financed from domestic and/or foreign sources have definite significance in the realisation of such goals. Under these prevailing conditions the clear-cut answer to, and the knowledge of the main determinants of the social and private cost of capital are necessary and sine qua non to a more efficient utilisation of this production factor.

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  • Dezséri, Kálmán, 1990. "On the determinants of capital costs in Brazil's manufacturing industries," Kiel Working Papers 416, Kiel Institute for the World Economy (IfW Kiel).
    • Handle: RePEc:zbw:ifwkwp:416
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    References listed on IDEAS

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    1. Merton Miller & Franco Modigliani, 1967. "Estimates of the Cost of Capital Relevant for Investment Decisions Under Uncertainty," NBER Chapters, in: Determinants of Investment Behavior, pages 179-213, National Bureau of Economic Research, Inc.
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    3. Hayashi, Fumio, 1982. "Tobin's Marginal q and Average q: A Neoclassical Interpretation," Econometrica, Econometric Society, vol. 50(1), pages 213-224, January.
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