A blog post from BEA Director Vipin Arora
It still seems novel to me that the United States is the world’s largest producer of crude oil, though we’ve had that distinction since 2018. And my guess is that even in the eternally optimistic oil business, there weren’t many people who predicted this back when the shale boom began gathering momentum. In fact, I remember claims at the time that even with new fracking technology, production would be restrained by a lack of capital, such as frac pumps.
Fast forward to today, and arguments that capital is limiting domestic production go far beyond the oil sector. From semiconductors to electric power generation, there are concerns that a lack of factories or equipment may be limiting what is—or could be—produced in the United States. Suppose I want to better understand these production constraints. Where can I find comprehensive and easily accessible data on capital?
BEA, of course.
Since the 1960s, our fixed assets accounts (FAAs) have provided estimates of the productive capital available in the economy and how it evolves over time. They measure the stock, depreciation, and investment of long-lived assets used in production. This includes structures, equipment, and intellectual property, such as software, research and development, and entertainment originals. They also measure the stock, depreciation, and spending for consumer durables, such as cars and furniture.
The FAAs break down our nation’s capital in several different ways. As you might expect, they provide estimates of different capital types (such as structures or equipment) by industry. But you can also get estimates by capital type for the entire economy. And we even give them to you by capital type and legal form of ownership (corporations, partnerships, etc.).
The FAAs do more than assess constraints on production. They can help analysts:
- Understand the potential for an industry to surge production.
- Evaluate the potential contribution of capital to increases in output and productivity.
- Measure net worth of the corporate sector and other key sectors.
- Gauge the ability of capital to move between sectors.
- Estimate the remaining service life of various capital types.
And I’m sure there’s much more they can do.
Whatever the use, BEA’s FAAs provide a gold mine of information on the nation’s capital stock that isn’t available anywhere else.