Timothy Taylor reports that the number of mergers and acquisitions increased in the 1980s, and never really declined. He concludes:
"These merger and acquisition patterns are certainly consistent with a vision of the US and the global economy in which large companies seem relatively more focused on spending their funds and their managerial time on financial maneuvers that allow them to reduce their exposure to market pressures (either by combining with direct competitors or combining with firms along the supply chain), and thus relatively less focused on seeking to improve their competitive position by internal investments in capital, skills, and innovation."
For a counterexample re capital investments, see this fascinating Bloomberg piece on how Intel makes a chip. Full of interesting bits.