CYCLIC VARIATIONS IN THE BRAZILIAN ECONOMY AND RETURN ON INVESTMENT

Abstract

The influence of the external scenario on the economic and financial structure of companies is a fundamental factor for decision-making. The objective of this study is to identify whether the Return on Investment (ROCE) of the financial economic sectors in Brazil is related to the phases of the economic cycles between the years 2000 and 2018. It is a descriptive research, with a quantitative approach, carried out through the identification of the Economic Cycles by the Real GDP and by the Kruskal-Wallis median test. The relevance of the research is centered on the improvement of the accounting information for decision making, since the results allow to know the sectors that present cyclical behavior. The results show that the ROCE showed significant differences in the phases of the Economic Cycles for all sectors. The evidence found is consistent with the literature that cycles consist of variations that end up affecting all sectors of an economy, but in a different way, given the particularities of each sector. Thus, when analyzing the sectors separately, it was observed that Civil Construction; Leisure, Culture and Entertainment; and Mining show significant differences, showing that the effects of the cycles occur with greater intensity in these sectors. Thus, managers, investors, creditors and users of accounting information from these three sectors need to be aware of cyclical economic changes for decision making, since in the analyzed period these sectors showed ROCE behaviors according to the phases of the Economic Cycles, that is, these sectors were more vulnerable than the other sectors.