In a working paper last week (available from NBER or from www.caseymulligan.net/w14446.pdf), Univ. of Chicago student Luke Threinen and I explained that the slump in residential investment should encourage non-residential investment. The diagram below was displayed in the paper, using data through 2008 Q2:
The BEA released its advance estimate of 2008 Q3 real GDP today, including their report that "[Real investment in] Nonresidential structures increased 7.9 percent [from 2008 Q2].... Real residential fixed investment decreased 19.1 percent...."
In terms of the Figure from the NBER wp, the orange line is higher in Q3 (115.7, as compared to 113.5 in Q2) and the blue line is lower (77.1, as compared to 81.3).
[other news from the report: real GDP overall was down 0.3%. Compare this to -0.2% for employment --> suggests that capital income is down about 0.6%]
3 comments:
Casey,If I read that table right, isn't this the continuation of a trend that's been going on for two years?
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