Description of table F.8 - Saving and Investment by Sector

This table shows the relationship between saving and investment, by sector, for the U.S. economy. It is based on national income and product accounts (NIPA) table 5.1 and is consistent with the Integrated Macroeconomic Accounts for the United States, jointly compiled by the Federal Reserve Board and the Bureau of Economic Analysis.

Gross saving is equal to net saving plus consumption of fixed capital. For each sector, net saving is the amount not spent out of current income. For households and institutions, net saving is personal income less the sum of personal outlays and personal current taxes, plus wage accruals, less disbursements. For domestic businesses, which include domestic financial and nonfinancial businesses, and foreign businesses in the United States, net saving is undistributed corporate profits plus inventory valuation and capital consumption adjustments (detail shown on table F.7). Net government saving is the difference between government current receipts and current expenditures.

In theory, gross saving can also be calculated as the sum of gross domestic investment, net capital account transactions, and capital account net lending (+) or net borrowing (-). In practice, however, the two calculations for gross saving differ by NIPA's statistical discrepancy. Gross domestic investment is the sum of gross private domestic investment (fixed investment and the change in private inventories) and government gross investment (detail shown on table F.6). Net capital account transactions include net capital transfers paid and net acquisition of nonproduced nonfinancial assets (detail shown on tables F.9 and F.6, respectively). Net lending (+) or net borrowing (-) shown on this table reflects the capital account, whereas net lending (+) or net borrowing (-) shown on sector tables in the flow of funds accounts is calculated as net acquisition of financial assets less total liabilities.

The value of irreparable damage to, or the destruction of, fixed assets is shown in addendum items on this table as disaster losses. As of 2009, these losses were no longer considered consumption of fixed capital but were reclassified as other volume changes (see tables R.100, R.102, and R.103). The threshold for determining whether any single event is treated as a disaster will be if either the associated property losses or the insurance payouts exceed 0.1 percent of GDP. The effects of losses from events smaller than this threshold are assumed to be already reflected in the estimates of depreciation and net current insurance settlements.

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