Friday, April 15, 2016

Brad DeLong — Nick Bunker: How concerned should we be about business investment and productivity growth?



WCEG
Must-Read: Nick Bunker: How concerned should we be about business investment and productivity growth?
Brad DeLong

1 comment:

Dan Lynch said...

What are firms doing with all these profits they’re earning and not investing, then? The data show that a large chunk of these profits are being distributed to shareholders in the form of increased dividends and stock buybacks.

Right. While households have paid down their debts, the business sector has gone into debt, much of it on questionable "investments" like fracking, overcapacity in transportation and commodity sectors, and stock buybacks.

The next recession may be triggered by corporate debt & overcapacity.