Net Stock of Fixed Private Capital, by Industry statistics

[In billions of dollars (12,760 represents $12,760,000,000,000) except quantity indexes, 1992=100] Standard Industrial Classification. For description of methodology, see below table]



Industry	1990	1991	1992	1993	1994	1995	1996	1997	1998


Fixed private capital	12760	13022	13583	14318	15204	15908	16723	17573	18643

Agriculture, forestry, and fishing	481	485	494	510	535	551	569	589	614
Farms	447	448	454	467	486	498	511	525	544
Housing	161	162	167	173	182	187	192	198	206
Other	285	286	287	294	304	311	319	327	338
Agricultural services, forestry, and fishing	35	37	40	44	49	53	59	63	70

Mining	431	404	406	418	433	455	483	501	530
Metal mining	29	29	30	31	33	34	36	36	37
Coal mining	32	32	32	34	36	39	41	44	47
Oil and gas extraction	350	324	325	334	344	360	384	397	420
Nonmetallic minerals, except fuels	19	19	19	19	20	21	22	24	26

Construction	82	82	83	87	93	101	109	118	129

Manufacturing	1217	1248	1286	1327	1387	1457	1521	1590	1660

Durable goods	636	646	661	678	709	747	782	821	861
Lumber and wood products	25	25	25	26	27	29	31	32	33
Furniture and fixtures	11	11	11	12	13	13	14	14	15
Stone, clay, and glass products	40	40	40	41	42	44	46	50	55
Primary metal industries	116	116	117	118	122	126	129	131	134
Fabricated metal products	70	70	72	74	77	81	84	87	91
Industrial machinery and equipment	110	112	115	117	121	126	130	137	143
Electronic and other electric equipment	92	94	96	100	108	120	133	143	153
Motor vehicles and equipment	64	66	68	73	78	85	90	96	102
Other transportation equipment	51	52	53	54	54	55	55	57	60
Instruments and related products	45	47	50	51	53	54	56	59	59
Miscellaneous manufacturing industries	12	12	12	13	13	14	15	15	15

Nondurable goods	581	602	626	648	679	711	738	769	800
Food and kindred products	119	122	127	132	138	146	151	159	166
Tobacco products	9	9	9	9	9	9	10	10	10
Textile mill products	34	34	34	35	37	38	39	40	41
Apparel and other textile products	11	11	12	12	13	13	14	14	14
Paper and allied products	84	87	89	91	94	98	101	104	108
Printing and publishing	52	54	55	56	58	59	61	63	66
Chemicals and allied products	157	165	173	181	190	200	210	221	229
Petroleum and coal products	75	78	82	86	90	93	95	96	96
Rubber and miscellaneous plastics products	38	40	42	44	48	52	55	60	65
Leather and leather products	3	3	3	3	3	3	3	3	3

Transportation and public utilities	1855	1894	1955	2055	2140	2232	2313	2398	2477

Transportation	582	586	601	634	661	692	721	748	776
Railroad transportation	304	303	307	324	329	337	349	353	349
Local and interurban passenger transit	21	21	22	23	24	25	27	27	28
Trucking and warehousing	71	71	72	77	89	99	104	114	126
Water transportation	35	35	35	36	37	37	38	39	40
Transportation by air	85	91	99	104	108	115	122	131	147
Pipelines, except natural gas	38	39	40	42	44	44	45	47	47
Transportation services	26	27	27	28	30	34	36	37	40

Communications	436	450	469	494	519	549	587	618	660
Telephone and telegraph	377	386	401	420	439	458	484	505	534
Radio and television	59	64	69	74	80	91	103	113	126

Electric, gas, and sanitary services	837	857	885	927	959	991	1005	1033	1041
Electric services	609	618	632	656	675	696	701	715	721
Gas services	165	171	180	192	200	205	212	222	223
Sanitary services	63	68	73	78	84	89	92	95	97

Wholesale trade	286	291	301	322	351	379	405	433	463

Retail trade	391	404	423	449	482	514	550	583	617

Finance, insurance, and real estate	7466	7639	8029	8505	9088	9481	9986	10518	11239
Depository institutions	236	242	255	260	266	268	275	285	301
Nondepository institutions	114	118	117	130	151	166	192	208	239
Security and commodity brokers	40	43	44	53	59	63	69	75	84
Insurance carriers	89	95	103	111	124	139	146	155	165
Insurance agents, brokers, and service	8	9	9	10	12	13	14	16	17
Real estate ¹	6944	7097	7463	7900	8429	8779	9232	9714	10359
Owner-occupied housing	4337	4445	4718	5053	5459	5718	6050	6394	6843
Tenant-occupied housing	1640	1655	1711	1765	1831	1880	1953	2026	2145
Other	967	997	1034	1082	1139	1182	1229	1293	1372
Holding and other investment offices	35	36	38	42	46	52	59	65	73

Services	552	575	606	646	695	739	786	843	913
Hotels and other lodging places	105	108	110	115	121	125	136	148	161
Personal services	27	26	25	25	26	27	27	29	31
Business services	99	103	107	115	122	131	139	147	161
Auto repair, services, and parking	62	70	78	87	101	111	119	125	131
Miscellaneous repair services	9	10	10	10	11	12	13	14	16
Motion pictures	16	17	18	21	24	28	31	35	39
Amusement and recreation services	34	35	36	39	43	47	50	55	59

Other services	200	208	221	233	246	257	272	291	314
Health services	98	103	111	120	128	135	143	153	165
Legal services	18	18	18	19	19	19	20	20	21
Educational services	11	11	12	13	13	14	15	16	17
Other ¹	73	75	79	82	86	90	94	102	111

1 Consists of social services, membership organizations, and miscellaneous professional services.

Source: U.S. Bureau of Economic Analysis, Fixed Reproducible Tangible Wealth, 1925-95; and Survey of Current Business, April 2000.

http://www.bea.doc.gov/bea/dn2.htm

Methodology for Net Stocks and Depreciation

The primary measure of the value of fixed reproducible tangible wealth is the net stock, that is, the value of the stock adjusted for depreciation. Depreciation is the decline in value due to wear and tear, obsolescence, accidental damage, and aging. For business and government, in addition to its use in calculating net stocks, the same depreciationconsumption of fixed capitalis presented as part of the NIPA's. Consumption of fixed capital is a charge for the using up of fixed capital, and as such, it is, along with compensation of employees and other components of gross domestic income and gross national income, one of the costs incurred and the profits earned in the production of gross domestic product (GDP) and gross national product (GNP). Consumption of fixed capital is deducted from GDP and GNP to derive net domestic product and net national product. In addition, government consumption of fixed capital is a component of government consumption expenditures (and GDP) as a measure of the value of the services of government fixed assets.

The net stock estimates in this article are presented in terms of two valuationscurrent cost and real cost. Current-cost (or "replacement-cost") valuation expresses all assets in the net stock in terms of the prices that prevailed in the period to which the stock estimates refer. For example, the yearend 1995 net stock estimate in current-cost valuation shows the assets that were in the stock at yearend 1995 expressed at the market prices prevailing for those assets at yearend 1995. The real-cost estimates are expressed either as quantity indexes or in "real" dollars, with 1992 as the base period.

Overview of methodology

Estimates of net stock and depreciationunder both the new and old methodologiesare derived using the perpetual inventory method, which is based on the accumulation of investment flows. With this method, both the net stock and depreciation of any given type of asset is a weighted average of past investment in that asset. Specifically, the net stock is calculated as the cumulative value of past gross investment less the cumulative value of past depreciation. The initial calculations are performed in real terms; current-dollar values are estimated by reflation.

Calculations of net stocks and depreciation are based on real investment data at the type-of-asset level of detail, which generally is the same level of detail as that presented in NIPA tables 5.7, 5.9, and 5.15, and real consumer purchases of durable goods, which generally is the same level of detail presented in NIPA table 2.7. At this detailed level, real investment in a given type of asset is obtained by dividing current-dollar investment in that type by the price index for new assets of that type, expressed as 1992=100, multiplied by 100. (Real investment for higher levels of detail shown in the NIPA tables is calculated using BEA's chain-type annual-weighted indexes.)

Under the new methodology, most assets are assumed to have depreciation patterns that decline geometrically over time. For a given year, the depreciation charges on existing assets are obtained by multiplying the prior year's charge by one minus the annual depreciation rate. For each type of asset, depreciation is cumulated over all vintages, and net stocks are estimated by subtracting cumulative depreciation from cumulative gross investment.

As is the case for real investment, year-to-year growth rates for both depreciation and net stocks on a real-cost basis for higher level aggregates are then computed using the annual-weighted Fisher index. These rates are chained together to obtain cumulative growth rates, which in turn are used to obtain estimates of levels expressed as indexes (1992=100) and as chained (1992) dollars.

Current-cost estimates (in dollars) are obtained by "reflating" real estimates at the type-of-asset level. Depreciation is reflated to current cost using indexes that reflect average prices of new assets for the year; net stock is reflated to current cost using indexes of prices of new assets for the current yearend. Current-cost aggregates are obtained by directly summing current-cost estimates for the various types of assets. Finally, estimates by type of asset are adjusted for the net value of assets destroyed in wars and natural disasters.

Investment flows

The investment flows in new equipment and structures by type and the transfers of used assets used to implement the perpetual inventory method come from the revised NIPA's. For privately owned assets, investment by type of asset is distributed by industry and by legal form of organization, primarily through the use of data from BEA's benchmark input-output accounts for 1982 and 1987 and from the 1987 and 1992 Economic Censuses. These flows are modified to account for transfers of used assets between sectors of the economy. (Because of the lack of information, transfers of used assets within sectors are not accounted for in the wealth estimates.)

Depreciation patterns and depreciation profiles

In the perpetual inventory method, the pattern of depreciation charges for a given asset is determined by its "depreciation profile." The new methodology for estimating depreciation uses depreciation profiles that reflect a geometric pattern and that replace the previously used profiles, which were based on straight-line depreciation and on assumed patterns of retirements. The depreciation profile for a given type of asset describes the pattern of how, in the absence of inflation, the price of an asset of that type declines as it ages. Although the profile for a given type of asset is assumed to be constant over time, different vintages of a given type of asset may have profiles that differ from those of other vintages of the same type of asset.

The new net stock and depreciation methodology uses depreciation profiles that are based on empirical evidence on used asset prices. Ideally, the profiles for each type of asset should be estimated using prices for used assets in resale markets, but such studies have only been conducted for some types of assets. However, the available studies suggest that, in general, depreciation profiles are more closely approximated by a geometric pattern of price declines than by a straight-line pattern. Consequently, in the revised estimates, the depreciation profiles for most assets were assumed to be strictly geometric, and the appropriate rate of declining-balance depreciation was taken from empirical studies of similar classes of assets. The depreciation rates for specific types of assets were then determined by dividing the appropriate declining-balance rate for each asset by the asset's assumed service life. For autos and for computers and computer peripheral equipment, two classes of assets for which information on used asset prices makes it possible to estimate the underlying depreciation profiles, the actual empirical profiles were used. For computers and peripheral equipment, the profiles were taken from studies by Stephen Oliner. For missiles and nuclear fuel rods, depreciation was estimated using a straight-line pattern and a Winfrey retirement pattern, which is essentially a bell-shaped curve.

The new geometric depreciation rates and the associated declining-balance depreciation rates and service lives used by BEA to derive the new estimates of net stocks and depreciation are shown in table A. Except as previously noted, BEA's depreciation rate equals the declining-balance rate divided by the service life. The rate of declining-balance depreciation is the multiple of the comparable straight-line rate used to calculate the geometric rate of depreciation. For example, a 1.65 declining-balance depreciation rate refers to a geometric rate of depreciation of 1.65/L, where L is the service life of the asset in years and 1/L is the straight-line rate. Separate service lives are used for each type of asset and for the estimates of fixed private capital; separate service lives are also used in different industries for certain types of assets. Most of the service lives are held constant over time because the information necessary to estimate changes in them is not available. The lives themselves are based on a wide variety of sources and for most types of assets, are the same as those used for the previously published estimates.

http://www.allcountries.org/uscensus/888_net_stock_of_fixed_private_capital.html

These tables are based on figures supplied by the United States Census Bureau, U.S. Department of Commerce and are subject to revision by the Census Bureau.

Copyright © 2006 Photius Coutsoukis and Information Technology Associates, all rights reserved.