Manufacturing Gains from Green Energy and Semiconductor Spending since the CHIPS and Inflation Reduction Acts

Omar Barbiero

No 2024-7, Current Policy Perspectives from Federal Reserve Bank of Boston

Abstract: Real investment—spending (net of inflation) on nonresidential construction, manufacturing equipment, and intellectual property products (IPP)—in the United States has grown substantially over the last few years despite the high-interest-rate environment that emerged in 2022 and is only now beginning to subside. The current strength of investment is important to policymakers because its sensitivity to interest rates makes it a key channel through which monetary policy is transmitted into the economy and because real private domestic investment constitutes 15 percent of US real GDP.

Keywords: CHIPS and Science Act; Inflation Reduction Act; green energy; semiconductors; manufacturing investment; fiscal incentives (search for similar items in EconPapers)
JEL-codes: E01 E22 E62 E65 Q58 (search for similar items in EconPapers)
Pages: 7
Date: 2024-11-19
New Economics Papers: this item is included in nep-ene and nep-env
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