ABSTRACT
All capital goods are included which are accounted for in gross fixed capital formation. Gross fixed capital formation in 1880 was about quite different items than the rate of investment in 1980, even when its influence on aggregate spending was more or less the same. More formally the process of investment is described as: Gross fixed capital formation consists of resident producers’ acquisitions, less disposals, of fixed assets during a given period plus certain additions to the value of non-produced assets realised by the productive activity of producer or institutional units. Most countries show a decline of the gross fixed capital formation rate starting somewhere in the 1970s or 1980s. Countries which managed to keep a stable or even increasing rate of investment after this period seem to have paid for this with severe financial busts.
