ABSTRACT
The 1990s saw relatively high rates of investment and productivity growth in the national economy. Many of these changes were based on computer technology, in particular, on the rapid improvement in computing speed and capacity and on the falling cost of computing capacity. The US economy underwent a number of recessions in the postwar era. The recession of 2000 grew out of an investment failure in the telecommunications industry that was of sufficient magnitude to have been at the heart of a downturn in investment in the overall nonresidential investment sector. Indexes of productivity are ratios of measures of output to the quantity of productive factors consumed in producing the output. The availability of capital plant of productivity superior to that of the existing plant shifts the decision emphasis of the capital-using firm from that of maintaining/increasing/decreasing the capital employed to that of maintaining/increasing/decreasing productive capacity.
