But far more important over the past six years have been the gains in output attributable to technological innovation, especially information technology and improved managerial organization, and, as I noted in testimony last week, the greater flexibility and resilience of our economy stemming from deregulation, primarily in finance. Notwithstanding these more-intangible contributions, the level of saving remains a key ingredient of economic growth.
But we need also to know whether the source of that saving is sustainable and, beyond that, whether the type of financial assets in which our saving overall is accumulated affects our productivity. During the past six years, about 40 percent of the total increase in our capital stock in effect has been financed, on net, by saving from abroad.