Privatização e dívida pública

Abstract

The use of the so-called privatization currencies in Brazil's National Privatization Program (PND) has arisen great controversy since its beginning. The paper develops models that assess under what conditions the acceptance of these moneys in exchange for the stock of state enterprises is attractive from a fiscal standpoint. We conclude that the optimal share to be paid in cash may be zero, one or a value in between. However, when the size of the enterprise is large with respect to the stock of privatization moneys, it will almost always be optimal to ask for full payment in cash. We also show that the minimum cash payment, in as much as it may be differentiate among investors, may be an important instrument to allow the state to maximize privatization revenues.