Investment Behavior of U.S. Firms over Heterogeneous Capital Goods: A Snapshot

2004-21 | March 1, 2006

Recent research has indicated that investment in certain capital types, such as computers, has fostered accelerated productivity growth and enabled a fundamental reorganization of the workplace. However, remarkably little is known about the composition of investment at the micro level. This short paper takes an important first step in filling this knowledge gap by looking at the newly available micro data from the 1998 Annual Capital Expenditure Survey (ACES), a sample of roughly 30,000 firms drawn from the private, nonfarm economy. The paper establishes a number of stylized facts. Among other things, I find that in contrast to aggregate data the typical firm tends to concentrate its capital expenditures in a very limited number of capital types, though which types are chosen varies greatly from firm to firm. In addition, computers account for a significantly larger share of firms’ incremental investment than they do of lumpy investment. [Keywords: Capital Heterogeneity, Investment; JEL Codes D21, D24, D29.]

Article Citation

J. Wilson, Daniel. 2004. “Investment Behavior of U.S. Firms over Heterogeneous Capital Goods: A Snapshot,” Federal Reserve Bank of San Francisco Working Paper 2004-21. Available at

About the Author
Daniel Wilson
Daniel Wilson is a vice president in the Economic Research Department of the Federal Reserve Bank of San Francisco. Learn more about Daniel Wilson