Capital services

In economics, capital services refer to a chain-type index of service flows derived from the stock of physical assets and software. These assets are coordination, equipment, software, structures, land, and inventories. Capital services are estimated as a capital-income weighted average of the growth rates of each asset. Capital services differ from capital stocks because short-lived assets such as equipment and software provide more services per unit of stock than long-lived assets such as land.[1] Unlike capital goods, capital services are owned by the person or group of people providing them.[2]

Role in productivity measurement

Capital services are widely used in growth accounting frameworks to measure the contribution of capital inputs to productivity. The OECD notes that capital services provide a more accurate measure of productive input than capital stock, because they reflect the flow of services generated by different types of assets rather than their replacement value. Short-lived assets such as machinery or software typically have higher service flows per unit of stock than long-lived assets such as structures and land.[3]

See also

References

  1. ^ "BLS Information". Glossary. U.S. Bureau of Labor Statistics Division of Information Services. February 28, 2008. Retrieved 2009-05-05.
  2. ^ "Capital Goods and Services". University of North Carolina. Retrieved 2009-05-06.
  3. ^ "OECD Productivity Manual: Measurement of Aggregate and Industry-Level Productivity Growth". Organisation for Economic Co-operation and Development. 2001. Retrieved 18 November 2025.



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