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Home > Terms > Armenian (HY) > ներդրում
ներդրում
Putting money to work, in the hope of making even more money. Investment takes two main forms: direct spending on buildings, machinery and so forth, and indirect spending on financial securities, such as bonds and shares. Traditionally, economic theory says that a country’s total investment must equal its total savings. But this has never been true in the short run and, as a result of globalization, may never be even in the long run, as countries with low savings can attract investment from overseas and foreign savers lacking opportunities at home can invest abroad (see foreign direct investment). The more of its GDP a country invests, the faster its economy should grow. This is why governments try so hard to increase total investment, for instance, using tax breaks and subsidies, or direct public spending on infrastructure. However, recent evidence suggests that the best way to encourage private-sector investment is to pursue stable macroeconomic policies, with low inflation, low interest rates and low rates of taxation. Curiously, economic studies have not found evidence that higher levels of investment lead to higher rates of GDP growth. One explanation for this is that the circumstances and manner in which money is invested count at least as much as the total sums invested. It ain’t how much you do, it’s the way that you do it.
- Part of Speech: noun
- Synonym(s):
- Blossary:
- Industry/Domain: Economy
- Category: Economics
- Company: The Economist
- Product:
- Acronym-Abbreviation:
Other Languages:
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