NC State Economist Dr. Mike Walden – “Changes in Business Investment”

Mary:  This is Mary Walden with economist MW, welcoming you to the economic perspective.   Today’s program looks at changes in business investment.  Mike, investments by businesses are important for making those firms profitable and the economy productive.   When we think of business investment we typically think of spending on equipment and machines.   But have there been recent changes in what businesses are investing in?

Mike:  Summary Answer

  1. You are correct, traditional investments have been in machines, transportation, buildings, and even computers, printers, phones
  2. While these are still very important, there’s been a subtle shift
  3. But there are also intangible investments businesses make – in worker training, research, and patents
  4. Indeed, businesses have been making more of these kinds of investments
  5. One implication however – aren’t captured by the current investment statistics – so business investment looks lower than it really is
  6. I’m MW

Mary:  And I’m Mary Walden for the North Carolina Cooperative Extension Service