Public and private investment in Brazil: Empirical evidence about complementarity

In this dissertation, we examine the relationship between public and private investment in Brazil in the 1955-1993 period. The public sector has always been an important agent in the Brazilian economy. However, historical observation and empirical evidence indicate that the state has lost some of its dynamic properties in the last decade. Overall, our results corroborate the long-run complementarity hypothesis for the Brazilian economy in the period in question. The provision of infrastructure capital, however, has a stronger impact than non-infrastructure investment. Hence, if public investment is used as a policy tool to encourage rapid growth of the private sector, infrastructure projects should be chosen over non-infrastructure ones. In the long-run, however, both types of investment will have a positive impact on private investment.U of I OnlyETDs are only available to UIUC Users without author permissio