This work presents a methodology to evaluate user cost of capital using firm level accounting data for French firms between 1984 and 2002. This evaluation relies on a modelling of individual user cost of capital that accounts for the structure of the financing of the firm, banking interest rates and the taxation of firms and shareholders. The model used in the paper comes from Crépon, Gianella (2001) and is inspired from Jorgenson (1963) and Auerbach (1983). We insist on the fact that the cost to use some capital actually depends on the nature of the assets that will be financed. The evaluation should then fit with the question at issue. Finally, the contribution of the paper is to use firm or sector level data each time these are available. Thus, the evaluation relies on an individual estimation of the taxation of benefits and uses sectorial life spans of capital computed by Picart (2004).
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