The contribution of household capital to the household production process is measured by the current price capital consumption, estimated using a Perpetual Inventory Model (PIM), which assumes straight line depreciation. The PIM requires constant price estimates of capital formation, for which we used household final consumption expenditure on capital goods, from Consumer Trends. It also requires the average life length of different assets. The source of this information was the E-Scope Study, the Eurostat Proposal on Household Satellite Account Methodology and the DVLA. Major household appliances were divided into different types of household capital using proportions from the Family Expenditure Survey and Mintel.

For further details, see Chapter 10 of the HHSA Methodology (downloads). The value of household capital consumption should be interpreted with caution, bearing in mind its sensitivity to some of the assumptions made. See Sensitivity Analysis for results using a geometric PIM and a capital services model.