This paper examines the macroeconomic factors which influence the behaviour of real interest rates in Spain over the long run. We use annual data for the period 1964-1991. The theoretical framework is based on a structural model in which the interest rate is determined by an equilibrium between saving and investment and therefore, by the variables bebind these aggregates. The results indicate that real interest rates depend on private wealth, demographic factors and the rate of return to physical capital in the long run. Fiscal policy variables appear to be significant only in the short term.

Keywords: real interest rates, saving, investment, cointegration, error correction model.