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Measuring Capital and Technology: An Expanded Framework

Measuring Capital and Technology: An Expanded Framework

Chapter:
(p.11) 1 Measuring Capital and Technology: An Expanded Framework
Source:
Measuring Capital in the New Economy
Author(s):
Carol CorradoCharles HultenDaniel Sichel
Publisher:
University of Chicago Press
DOI:10.7208/chicago/9780226116174.003.0002

This chapter provides guidance on what components of business spending should be included in measures of capital investment. It presents a model that defines capital investment as any outlay that is intended to increase future rather than current consumption should be treated as investment. This chapter explains that a significant portion of investment in traditional equipment and structures is excluded from the existing investment figures in U.S. national income and product accounts (NIPAs) and suggests that a move to recognize intangible capital might alter our understanding of the factors determining economic growth.

Keywords:   business spending, capital investment, U.S, NIPAs, intangible capital, economic growth

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