Saving and Investment Are In Long-Term Decline

November 18, 2014

Economic growth has hovered around 2 percent in recent years. One reason for the slow growth is that saving and investment have been declining in the U.S. for nearly a half century. Both are crucial to the economy.

Investment is important, because it provides American workers with the means to be more productive. Saving is important, because it provides the money needed for investment, which explains the close correlation between the two trends.

Tax policy is one of the many factors contributing to the long-term decline in saving and investment.

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