Capital Formation and Capital Stock in Indonesia, 1950-2007 (updated to 1950-2013)

This paper presents long-term estimates of gross fixed capital formation for 1951-2007 that
are disaggregated by categories of productive assets. These data, combined with
approximations of probable average asset lives and a feasible asset retirement method are
used in a Perpetual Inventory Method to estimate gross fixed capital stock in Indonesia for
1950-2007 disaggregated by productive assets. Most of Indonesia’s capital stock long
consisted of residential and non-residential structures. Total capital stock grew significantly
since the late-1960s at about 10% per year, until the 1997-98 economic crisis. The high
capital-output ratio in 1997 suggests that part of Indonesia’s high economic growth during
the 1990s was due to unsustainable resource accumulation.