Sunday, December 19, 2010

Declining Usage of Productive Capability

This post at Calculated Risk has a series of graphs, one of which shows the usage of productive capability over the years. What strikes me is that usage was at 88 percent or so in 1967, but the peak declined to 85 percent in the 1980's and 1990's and to about 82 percent in the 2000's. I wonder what's going on?
  • Is there a systemic problem with the statistics?
  • Are companies investing too much in capabilities?
  • Have tax breaks for investment resulted in over investment?
  • Something else?

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