On Constructing a New Series on Corporate Fixed Investment

In this paper we have attempted to look at the various estimates that are currently available in relation to gross fixed investment in the corporate sector. These various estimates differ considerably among themselves not only in absolute amount but also in terms of year to year changes. Using the sample data provided by the Reserve Bank of India on the finances of public and private limited companies we have constructed a new series on corporate investment. We first estimated a series of total paid up capital in relation to public and private limited companies. These gave us the blow up factors to be used on the sample data. There is no reason to claim that our estimates are superior or better. However, we have in this paper brought out explicitly all the assumptions made in arriving at the estimates. Our study indicates very clearly that unless one is able to construct a reasonably reliable series on paid up capital of public and private limited companies, differences will continue to exist among the series provided by the different agencies as the estimates of gross fixed assets and therefore of gross fixed investment are extremely sensitive to the blow up factors used.