9 Gross fixed capital formation

Printable version (PDF) of Chapter 9 (June 30, 2008)


9.1 In the Income and Expenditure Accounts (IEA), gross fixed capital formation is divided into three principal types of investment expenditure:

  • residential structures;
  • non-residential structures; and
  • machinery and equipment.

9.2 Estimates of each type of investment are produced for the business1 and government sectors in the IEA. The discussion in this chapter is structured around these three major categories of gross fixed capital formation.

9.3 Fixed investment expenditure is a significant part of aggregate demand. This activity is tied to economic growth through its impact on the productive stock of capital, to social welfare in relation to government infrastructure, and to business cycles in terms of the volatility of its components.


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1. Includes corporations, unincorporated businesses and non-profit institutions serving households.

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