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Depreciation Rates in a Transition Economy: Evidence from Czech Panel Data

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  • Lubomir Lizal

    (CERGE-EI)

Abstract

This paper examines industrial differences in depreciation rates and the suitability of financial data for a microeconomic analysis. Depreciation is a main source of enterprise investment and serves as a source for replacement of obsolete or used-up capital. The findings on capital structure in this paper are consistent with the common view that heavy industry firms have long-life capital while firms operating in electronics, or light industry as a whole, have a capital structure containing a higher portion of a short-life capital. Also, larger firms are more likely to have a higher portion of long-life capital, like real estate. The last conclusion drawn from this analysis is that certain types of financial data might be highly influenced by seasonal effects which could operate as a measurement error and therefore distort estimates which are sensitive to measurement error.

Suggested Citation

  • Lubomir Lizal, 2001. "Depreciation Rates in a Transition Economy: Evidence from Czech Panel Data," Microeconomics 0012004, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpmi:0012004
    Note: Type of Document - Acrobat PDF; pages: 26 ; figures: Included
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    References listed on IDEAS

    as
    1. Whited, Toni M, 1992. "Debt, Liquidity Constraints, and Corporate Investment: Evidence from Panel Data," Journal of Finance, American Finance Association, vol. 47(4), pages 1425-1460, September.
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    Cited by:

    1. Lubomír Lízal & Jan Svejnar, 2002. "Investment, Credit Rationing, And The Soft Budget Constraint: Evidence From Czech Panel Data," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 353-370, May.
    2. Janez Prasnikar & Jan Svejnar, 1998. "Investment Wages and Ownership During the Transition to a Market Economy: Evidence from Slovenian Firms," William Davidson Institute Working Papers Series 144, William Davidson Institute at the University of Michigan.
    3. Dana Hajkova, 2008. "The Measurement of Capital Services in the Czech Republic," Working Papers 2008/11, Czech National Bank, Research and Statistics Department.
    4. Jaromír Hurník & David Navrátil, 2005. "Potential Output in the Czech Republic: A Production Function Approach," Prague Economic Papers, Prague University of Economics and Business, vol. 2005(3), pages 253-266.
    5. Lubomir Lizal, 1999. "Does a Soft Macroeconomic Environment Induce Restructuring on the Microeconomic Level during the Transition Period? Evidence from Investment Behavior of Czech Enterprises," William Davidson Institute Working Papers Series 235, William Davidson Institute at the University of Michigan.
    6. Lubomir Lizal & Jan Svejnar, 2000. "Financial Conditions and Investment during the Transition: Evidence from Czech Firms," CERGE-EI Working Papers wp153, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    7. Jarko Fidrmuc & Roman Horváth & Eva Horváthová, 2010. "Corporate Interest Rates and the Financial Accelerator in the Czech Republic," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 46(4), pages 41-54, January.

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    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • K34 - Law and Economics - - Other Substantive Areas of Law - - - Tax Law
    • M4 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting
    • P11 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Planning, Coordination, and Reform

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