Hostname: page-component-5c6d5d7d68-pkt8n Total loading time: 0 Render date: 2024-08-22T10:52:40.084Z Has data issue: false hasContentIssue false
  • English
  • Français

Is UK Business Investment Unusually Weak?

Published online by Cambridge University Press:  26 March 2020

Ray Barrell  and
Rebecca Riley
Ray Barrell
Affiliation:
London
Rebecca Riley
Affiliation:
National Institute of Economic and Social Research
Get access Rights & Permissions [Opens in a new window]

Extract

In the 15 years to 2000 UK business investment rose quite substantially in real terms. Having shown little deviation from an average of 7¼ per cent over the period 1965–85, the real share of business investment in GDP measured 10¾ per cent in 2000 (see figure 1). One of the factors contributing to this increase was the sharp fall in the relative price of investment goods, the scale of which is illustrated by the altogether different trends in real and nominal shares of business investment in GDP.

Type
Articles
Information
National Institute Economic Review , Volume 196 , 01 April 2006 , pp. 60 - 62
Copyright
Copyright © 2006 National Institute of Economic and Social Research

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

Thanks to Martin Weale for helpful comment.

References

Bakhshi, H., Oulton, N. and Thompson, J. (2003), ‘Modelling investment when relative prices are trending: theory and evidence for the United Kingdom’, Bank of England Working Paper No. 189.Google Scholar
Bakhshi, H. and Thompson, J. (2002), ‘Explaining trends in UK business investment’, Bank of England Quarterly Bulletin, Spring, pp. 33–41.Google Scholar
Bean, C. (1981), ‘An econometric model of manufacturing investment in the UK’, Economic Journal, 91, pp. 106–21.CrossRefGoogle Scholar
Ellis, C. and Price, S. (2004), ‘UK business investment and the user cost of capital’, Manchester School, 72 S1, pp. 72–93.CrossRefGoogle Scholar
Oulton, N. and Young, G. (1996), ‘How high is the social rate of return to fixed investment?’, Oxford Review of Economic Policy, 12, pp. 48–69.CrossRefGoogle Scholar