So, if margins are high but investment is low, what have companies done with their profits? Following the money leads us directly to shareholders. As we can see from Figure 29, corporations have largely returned profits to shareholders in the form of dividends and share buy-backs. Having averaged 10–20 per cent in the 1970s, the percentage of cash flow returned to shareholders has remained above 30, and sometimes substantially more than that for most of the past thirty years, although it dipped during the tech boom in the early 1990s when companies were investing.
