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Capital stocks and capital services: Integrated and consistent estimates for the United Kingdom, 1950–2013

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  • Oulton, Nicholas
  • Wallis, Gavin

Abstract

The evolution of capital services is crucial for understanding labour productivity growth. Capital stocks and the wealth–income ratio are important for understanding welfare and inequality. Accordingly, we present annual estimates of fixed capital services and capital stocks for the United Kingdom, 1950–2013, for the whole economy and for the market sector. Our estimates cover nine asset types including R&D. We compare estimates of capital services based on an endogenous (ex post) rate of return with ones based on a hybrid method which allows for ex ante risk: firms' expectations may not be satisfied. Contrary to expectation, we find that capital intensity (capital services per hour worked) rose during the Great Recession even though labour productivity fell. And the wealth–income ratio is now substantially lower than it was in the early 1980s unless dwellings are included in the total.

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  • Oulton, Nicholas & Wallis, Gavin, 2016. "Capital stocks and capital services: Integrated and consistent estimates for the United Kingdom, 1950–2013," Economic Modelling, Elsevier, vol. 54(C), pages 117-125.
    • Handle: RePEc:eee:ecmode:v:54:y:2016:i:c:p:117-125
    DOI: 10.1016/j.econmod.2015.12.024
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    Cited by:

    1. Peter Goodridge & Jonathan Haskel, 2023. "Accounting for the slowdown in UK innovation and productivity," Economica, London School of Economics and Political Science, vol. 90(359), pages 780-812, July.
    2. Leandro Prados de la Escosura, 2022. "Capital in Spain, 1850–2019," Cliometrica, Journal of Historical Economics and Econometric History, Association Française de Cliométrie (AFC), vol. 16(1), pages 1-28, January.
    3. Oulton, Nicholas, 2020. "Measuring productivity: theory and British practice," LSE Research Online Documents on Economics 106473, London School of Economics and Political Science, LSE Library.
    4. Dacic, Nikola & Melolinna, Marko, 2022. "The size-centrality relationship in production networks," Bank of England working papers 994, Bank of England.
    5. Rebecca Riley & Ana Rincon-Aznar & Lea Samek, 2018. "Below the Aggregate: A Sectoral Account of the UK Productivity Puzzle," Economic Statistics Centre of Excellence (ESCoE) Discussion Papers ESCoE DP-2018-06, Economic Statistics Centre of Excellence (ESCoE).
    6. Nicholas Crafts, 2021. "The Sources Of British Economic Growth Since The Industrial Revolution: Not The Same Old Story," Journal of Economic Surveys, Wiley Blackwell, vol. 35(3), pages 697-709, July.
    7. Stephen Broadberry, 2022. "British economic growth and development," Oxford Economic and Social History Working Papers _203, University of Oxford, Department of Economics.
    8. Escribá-Pérez, F.J. & Murgui-García, M.J. & Ruiz-Tamarit, J.R., 2018. "Economic and statistical measurement of physical capital: From theory to practice," Economic Modelling, Elsevier, vol. 75(C), pages 246-255.
    9. Aramendia, Emmanuel & Brockway, Paul E. & Pizzol, Massimo & Heun, Matthew K., 2021. "Moving from final to useful stage in energy-economy analysis: A critical assessment," Applied Energy, Elsevier, vol. 283(C).
    10. Bill Martin & Centre for Business Research, 2018. "A Comment on Oulton, "The UK Productivity Puzzle: Does Arthur Lewis Hold the Key?"," Working Papers wp498, Centre for Business Research, University of Cambridge.

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    More about this item

    Keywords

    Capital services; Capital stocks; Rate of return; Depreciation;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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