Avaliação econométrica do Fundo de Desenvolvimento Industrial do Estado do Ceará

Abstract

The aim of this paper is to econometrically evaluate the efficacy of the Industrial Development Fund of Ceará (FDI) regarding its objective of job creation. The analysis comprehends the period 1995 - 2001, where the mechanism of incentives was largely utilized. By means of a data base containing information about firms that received incentives and decided to locate in the state, three different specifications are estimated: a first one, uses only a cross-section of the complete data set and the other two employ the whole sample. To handle the problem of endogeneity inherent to the cross-section model, an unusual instrumental variable is employed: the political configuration in the state and counties. As to the panel data specifications, the endogeneity problem can be handled by means of a fixed effects model. As a general result, the econometric evaluation concludes that the industrial program did not help to generate jobs. This conclusion is important for future elaborations of changes in the industrial policy of the state of Ceará and other states of the northeast of Brazil.