Has Business Fixed Investment Really Been Unusually Low?
Abstract: Business fixed investment represents the spending by businesses to increase production capacity. It is traditionally decomposed into equipment (such as computers and machines), structures (such as plants, shopping malls, or warehouses), and intellectual property (such as software and R&D). After declining sharply during the Great Recession, business fixed investment (BFI) recovered in 2010, but investment was again quite low in 2015 and 2016. This slowdown was driven in part by the decline of oil prices that led to a significant contraction in the oil drilling industry. Since then, growth has resumed. Figure 1 depicts this recent history.
File format is application/pdf
Description: Full text
Provider: Federal Reserve Bank of Chicago
Part of Series: Chicago Fed Letter
Publication Date: 2019
Order Number: 418