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In
economics Economics () is a social science Social science is the Branches of science, branch of science devoted to the study of society, societies and the Social relation, relationships among individuals within those societies. The term was fo ...

economics
, capital consists of human-created assets that can enhance one's power to perform economically useful work. For example, a stone arrowhead is capital for a
hunter-gatherer A hunter-gatherer is a human Humans (''Homo sapiens'') are the most populous and widespread species of primates, characterized by bipedality, opposable thumbs, hairlessness, and intelligence allowing the use of culture, language and tools. T ...
who can use it as a hunting instrument; similarly, roads are capital for inhabitants of a city. Capital is distinct from land and other
non-renewable resources A non-renewable resource (also called a finite resource) is a natural resource that cannot be readily replaced by natural means at a quick enough pace to keep up with consumption. An example is carbon-based fossil fuel. The original organic matter ...
in that it can be increased by human labor, and does not include certain
durable good In economics, a durable good or a hard good or consumer durable is a Good (economics), good that does not quickly wear out or, more specifically, one that yields utility over time rather than being completely Consumption (economics), consumed in ...
s like homes and personal automobiles that are not used in the production of saleable goods and services.
Adam Smith Adam Smith ( 1723 – 17 July 1790) was a Scottish economist, philosopher as well as a moral philosopher Ethics or moral philosophy is a branch of philosophy that "involves systematizing, defending, and recommending concepts of right and ...

Adam Smith
defined capital as "that part of man's stock which he expects to afford him revenue". In
economic model In economics Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods ...

economic model
s, capital is an input in the
production function In economics Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods a ...
. The total
physical capital Physical capital represents in economics Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (economics), distribution, and Consumption (economi ...
at any given moment in time is referred to as the capital stock (not to be confused with the
capital stock__NOTOC__ A corporation's share capitalGlossary on Trade Financing Terms - S
or capital ...
of a business entity).
Capital good The economic concept of a capital good (also called complex product systems (CoPS), H. Rush, "Managing innovation in complex product systems (CoPS)," IEE Colloquium on EPSRC Technology Management Initiative (Engineering & Physical Sciences Research ...
s, real capital, or
capital assetA capital asset is defined to include property of any kind held by an assessee, whether connected with their business or profession or not connected with their business or profession. It includes all kinds of property, movable or immovable, tangible ...
s are already-produced,
durable good In economics, a durable good or a hard good or consumer durable is a Good (economics), good that does not quickly wear out or, more specifically, one that yields utility over time rather than being completely Consumption (economics), consumed in ...
s or any non-financial asset that is used in
production Production may be: Economics and business * Production (economics) * Production, the act of manufacturing goods * Production, in the outline of industrial organization, the act of making products (goods and services) * Production as a statistic, g ...
of
goods In economics Economics () is a social science Social science is the branch A branch ( or , ) or tree branch (sometimes referred to in botany Botany, also called , plant biology or phytology, is the science of plant ...
or
services Service may refer to: Activities :''(See the Religion section for religious activities)'' * Administrative service, a required part of the workload of Faculty (academic staff), university faculty * Civil service, the body of employees of a governm ...
. In
Marxian economics Marxian economics, or the Marxian school of economics, is a heterodox In religion, heterodoxy (from Ancient Greek Ancient Greek includes the forms of the Greek language used in ancient Greece and the classical antiquity, ancient world f ...
, capital is money used to buy something only in order to sell it again to realize a profit. For Marx, capital only exists within the process of the
economic circuit
economic circuit
(represented by
M-C-M' In classical political economy and especially Karl Marx Karl Heinrich Marx (; 5 May 1818 – 14 March 1883) was a German philosopher, economist, historian, sociologist, political theorist, journalist and socialist revolutionary. Born in Trie ...
)—it is
wealth Wealth is the abundance of valuable financial asset A financial asset is a non-physical asset whose value is derived from a contractual claim, such as deposit (finance), bank deposits, bond (finance), bonds, and participations in companies' sh ...

wealth
that grows out of the process of circulation itself, and for Marx it formed the basis of the economic system of
capitalism Capitalism is an economic system An economic system, or economic order, is a system A system is a group of interacting Interaction is a kind of action that occurs as two or more objects have an effect upon one another. The idea o ...

capitalism
. In more contemporary schools of economics, this form of capital is generally referred to as "
financial capital Financial capital (also simply known as capital or equity in finance Finance is a term for the management, creation, and study of money In a 1786 James Gillray caricature, the plentiful money bags handed to King George III are contra ...
" and is distinguished from "
capital good The economic concept of a capital good (also called complex product systems (CoPS), H. Rush, "Managing innovation in complex product systems (CoPS)," IEE Colloquium on EPSRC Technology Management Initiative (Engineering & Physical Sciences Research ...
s".


In narrow and broad uses

Classical Classical may refer to: European antiquity *Classical antiquity, a period of history from roughly the 7th or 8th century B.C.E. to the 5th century C.E. centered on the Mediterranean Sea *Classical architecture, architecture derived from Greek and ...
and
neoclassical economics Neoclassical economics is an approach to economics in which the production, consumption and valuation (pricing) of goods and services are driven by the supply and demand In microeconomics, supply and demand is an economic model In econo ...
regard capital as one of the
factors of production In economics Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods a ...
(alongside the other factors:
land Land is the solid surface of Earth that is not permanently submerged in water. Most but not all land is situated at elevations above sea level (variable over geologic time frames) and consists mainly of Earth's crust, crustal components such a ...
and
labour Labour or labor may refer to: * Childbirth Childbirth, also known as labour or delivery, is the ending of pregnancy where one or more babies leaves the uterus by passing through the vagina or by Caesarean section. In 2015, there were about 13 ...
). All other inputs to production are called intangibles in classical economics. This includes organization,
entrepreneurship Entrepreneurship is the creation or extraction of value. With this definition, entrepreneurship is viewed as change, generally entailing risk beyond what is normally encountered in starting a business, which may include other values than simply ...
, knowledge, goodwill, or management (which some characterize as
talent
talent
,
social capital Social capital is "the networks of relationships among people who live and work in a particular society, enabling that society to function effectively". It involves the effective functioning of social group In the social science Soc ...
or
instructional capital Instructional capital is a term used in educational administration after the 1960s, to reflect capital resulting from investment in producing learning materials. Education finance Capital (economics) {{education-stub ...
). This is what makes it a factor of production: * The good is not used up immediately in the process of production unlike raw materials or
intermediate good Intermediate goods, producer goods or semi-finished products are goods In economics Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (econo ...
s. (The significant exception to this is
depreciation In accountancy, depreciation refers to two aspects of the same concept: first, the actual decrease of fair value of an asset, such as the decrease in value of factory equipment each year as it is used and wear, and second, the allocation in a ...

depreciation
allowance, which like intermediate goods, is treated as a business expense.) * The good can be produced or increased (in contrast to land and
non-renewable resources A non-renewable resource (also called a finite resource) is a natural resource that cannot be readily replaced by natural means at a quick enough pace to keep up with consumption. An example is carbon-based fossil fuel. The original organic matter ...
). These distinctions of convenience have carried over to contemporary
economic theory Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. ...
. Adam Smith provided the further clarification that capital is a
stock In finance, stock (also capital stock) consists of all of the shares In financial markets A financial market is a market in which people trade financial securities and derivatives at low transaction costs. Some of the securities i ...
. As such, its value can be estimated at a point in time. By contrast,
investment Investment is the dedication of an asset to attain an increase in value over a period of time. Investment requires a sacrifice of some present asset, such as time, money, or effort. In finance Finance is the study of financial institution ...
, as production to be added to the capital stock, is described as taking place over time ("per year"), thus a
flow Flow may refer to: Science and technology * Flow (fluid) or fluid dynamics, the motion of a gas or liquid * Flow (geomorphology), a type of mass wasting or slope movement in geomorphology * Flow (mathematics), a group action of the real numbers on ...
.
Marxian economics Marxian economics, or the Marxian school of economics, is a heterodox In religion, heterodoxy (from Ancient Greek Ancient Greek includes the forms of the Greek language used in ancient Greece and the classical antiquity, ancient world f ...
distinguishes between different forms of capital: *
constant capital Constant capital (c), is a concept created by Karl Marx Karl Heinrich Marx (; 5 May 1818 – 14 March 1883) was a German philosopher, economist, historian, sociologist, political theorist, journalist and socialist revolutionary. Born in Tri ...
, which refers to capital goods *
variable capital Constant capital (c), is a concept created by Karl Marx and used in Marxian economics, Marxian political economy. It refers to one of the forms of Capital (economics), capital invested in Production (economics), production, which contrasts with v ...
, which refers to labor-inputs, where the cost is "variable" based on the amount of wages and salaries paid during an employee's contract/employment, * fictitious capital, which refers to intangible representations or abstractions of physical capital, such as stocks, bonds and securities (or "tradable paper claims to wealth") Earlier illustrations often described capital as physical items, such as tools, buildings, and vehicles that are used in the production process. Since at least the 1960s economists have increasingly focused on broader forms of capital. For example, investment in skills and education can be viewed as building up
human capital Human capital is a concept used by human resource professionals to designate personal attributes considered useful in the production process. It encompasses employee knowledge Knowledge is a familiarity or awareness, of someone or someth ...

human capital
or knowledge capital, and investments in
intellectual property Intellectual property (IP) is a category of property Property is a system of rights that gives people legal control of valuable things, and also refers to the valuable things themselves. Depending on the nature of the property, an owner o ...
can be viewed as building up
intellectual capitalIntellectual capital is the result of mental processes that form a set of intangible objects that can be used in economic activity and bring income to its owner (organization), covering the competencies of its people (human capital), the value relati ...
. These terms lead to certain questions and controversies discussed in those articles.


Modern types of capital

Detailed classifications of capital that have been used in various theoretical or applied uses generally respect the following division: *
Financial capital Financial capital (also simply known as capital or equity in finance Finance is a term for the management, creation, and study of money In a 1786 James Gillray caricature, the plentiful money bags handed to King George III are contra ...
, which represents obligations, and is liquidated as money for trade, and owned by legal entities. It is in the form of capital assets, traded in financial markets. Its market value is not based on the historical accumulation of money invested but on the perception by the market of its expected revenues and of the risk entailed. *
Natural capital on "natural capital" and "balancing the budget of our resources" File:Fires along the Rio Xingu, Brazil - NASA Earth Observatory.jpg, Fires along the Rio Xingu, Brazil - NASA Earth Observatory. Loss of natural capital assets may have significant ...
, which is inherent in ecologies and which increases the supply of human wealth *
Social capital Social capital is "the networks of relationships among people who live and work in a particular society, enabling that society to function effectively". It involves the effective functioning of social group In the social science Soc ...
, which in private enterprise is partly captured as goodwill or brand value, but is a more general concept of inter-relationships between human beings having money-like value that motivates actions in a similar fashion to paid compensation. *
Instructional capital Instructional capital is a term used in educational administration after the 1960s, to reflect capital resulting from investment in producing learning materials. Education finance Capital (economics) {{education-stub ...
, defined originally in academia as that aspect of teaching and knowledge transfer that is not inherent in individuals or social relationships but transferable. ''Various theories use names like
knowledge Knowledge is a familiarity or awareness, of someone or something, such as facts A fact is something that is truth, true. The usual test for a statement of fact is verifiability—that is whether it can be demonstrated to correspond to e ...
or
intellectual capitalIntellectual capital is the result of mental processes that form a set of intangible objects that can be used in economic activity and bring income to its owner (organization), covering the competencies of its people (human capital), the value relati ...
to describe similar concepts but these are not strictly defined as in the academic definition and have no widely agreed accounting treatment.'' *
Human capital Human capital is a concept used by human resource professionals to designate personal attributes considered useful in the production process. It encompasses employee knowledge Knowledge is a familiarity or awareness, of someone or someth ...

Human capital
, a broad term that generally includes social, instructional and individual human
talent
talent
in combination. ''It is used in technical economics to define “balanced growth”, which is the goal of improving human capital as much as economic capital. *
Public capital Public capital is the aggregate body of government-owned assets that are used as a means for productivity.Aschauer, D. A. (1990). Why is infrastructure important? Conference Series roceedings Federal Reserve Bank of Boston. Pp. 21-68. Such assets ...
is a blanket term that attempts to characterize physical capital that is considered
infrastructure Infrastructure is the set of fundamental facilities and systems that support the sustainable functionality of households and firms. Serving a country, city, or other area, including the services and facilities necessary for its economy An ec ...

infrastructure
and which supports production in unclear or poorly accounted ways. This encompasses the aggregate body of all government-owned assets that are used to promote private industry productivity, including highways, railways, airports, water treatment facilities, telecommunications, electric grids, energy utilities, municipal buildings, public hospitals and schools, police, fire protection, courts and still others. However, it is a problematic term insofar as many of these assets can be either publicly or privately owned. * Ecological capital is the world's stock of natural resources, which includes geology, soils, air, water and all living organisms. Some natural capital assets provide people with free goods and services, often called ecosystem services. Two of these (clean water and fertile soil) underpin our economy and society and make human life possible. Separate literatures have developed to describe both
natural capital on "natural capital" and "balancing the budget of our resources" File:Fires along the Rio Xingu, Brazil - NASA Earth Observatory.jpg, Fires along the Rio Xingu, Brazil - NASA Earth Observatory. Loss of natural capital assets may have significant ...
and
social capital Social capital is "the networks of relationships among people who live and work in a particular society, enabling that society to function effectively". It involves the effective functioning of social group In the social science Soc ...
. Such terms reflect a wide
consensus Consensus decision-making or consensus politics (often abbreviated to ''consensus'') is group decision-making processes in which participants develop and decide on proposals with the aim, or requirement, of acceptance by all. The focus on es ...

consensus
that nature and society both function in such a similar manner as traditional industrial infrastructural capital, that it is entirely appropriate to refer to them as different types of capital in themselves. In particular, they can be used in the production of other goods, are not used up immediately in the process of production, and can be enhanced (if not created) by human effort. There is also a literature of
intellectual capitalIntellectual capital is the result of mental processes that form a set of intangible objects that can be used in economic activity and bring income to its owner (organization), covering the competencies of its people (human capital), the value relati ...
and
intellectual property law Intellectual property (IP) is a category of property that includes intangible creations of the human intellect. There are many types of intellectual property, and some countries recognize more than others. The most well-known types are copyrig ...
. However, this increasingly distinguishes means of capital investment, and collection of potential rewards for
patent A patent is a type of intellectual property Intellectual property (IP) is a category of property Property is a system of rights that gives people legal control of valuable things, and also refers to the valuable things themselves. Depe ...

patent
,
copyright Copyright is a type of intellectual property Intellectual property (IP) is a category of property Property is a system of rights that gives people legal control of valuable things, and also refers to the valuable things themselves. ...

copyright
(creative or
individual capital Individual capital, the economic view of talent, comprises inalienable or personal traits of persons, tied to their bodies and available only through their own free will Free will is the ability to choose between different possible courses of ...
), and
trademark A trademark (also written trade mark or trade-mark) is a type of intellectual property Intellectual property (IP) is a category of property Property is a system of rights that gives people legal control of valuable things, and also r ...

trademark
(social trust or
social capital Social capital is "the networks of relationships among people who live and work in a particular society, enabling that society to function effectively". It involves the effective functioning of social group In the social science Soc ...
) instruments. Building on Marx, and on the theories of the sociologist and philosopher
Pierre Bourdieu Pierre Bourdieu (; 1 August 1930 – 23 January 2002) was a French sociologist and public intellectual An intellectual is a person who engages in critical thinking, research, and Human self-reflection, reflection to advance discussions of ...
, scholars have recently argued for the significance of "culinary capital" in the arena of food. The idea is that the production, consumption, and distribution of knowledge about food can confer power and status.


Interpretations

Within classical economics,
Adam Smith Adam Smith ( 1723 – 17 July 1790) was a Scottish economist, philosopher as well as a moral philosopher Ethics or moral philosophy is a branch of philosophy that "involves systematizing, defending, and recommending concepts of right and ...

Adam Smith
(''Wealth of Nations'', Book II, Chapter 1) distinguished
fixed capital In accounting Accounting or Accountancy is the measurement, processing, and communication of financial and non financial information about economic entity, economic entities such as businesses and corporations. Accounting, which has been call ...
from
circulating capitalCirculating capital includes intermediate goods and operating expenses, i.e., short-lived items that are used in production and used up in the process of creating other goods or services. Mark Blaug, 2008. "circulating capital," ''The New Palgrave ...
. The former designated physical assets not consumed in the production of a product (e.g. machines and storage facilities), while the latter referred to physical assets consumed in the process of production (e.g. raw materials and intermediate products). For an enterprise, both were types of capital. Economist
Henry George Henry George (September 2, 1839 – October 29, 1897) was an American political economist and journalist. His writing was immensely popular in 19th-century America and sparked several reform movements of the Progressive Era. He inspired the econ ...

Henry George
argued that financial instruments like stocks, bonds, mortgages, promissory notes, or other certificates for transferring wealth is not really capital, because "Their
economic value In economics Economics () is a social science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the beh ...
merely represents the power of one class to appropriate the earnings of another" and "their increase or decrease does not affect the sum of wealth in the community". Some thinkers, such as
Werner Sombart Werner Sombart (; ; 19 January 1863 – 18 May 1941) was a German economist An economist is a practitioner in the social sciences, social science discipline of economics. The individual may also study, develop, and apply theories and concepts ...
and
Max Weber Maximilian Karl Emil Weber (; ; 21 April 186414 June 1920) was a German Sociology, sociologist, historian, jurist, and political economy, political economist regarded as among the most important theorists of the development of Modernity, modern ...

Max Weber
, locate the concept of capital as originating in
double-entry bookkeeping Double-entry bookkeeping, also known as, double-entry accounting, is a method of bookkeeping Bookkeeping is the recording of financial transactions, and is part of the process of accounting Accounting or Accountancy is the measureme ...
, which is thus a foundational innovation in
capitalism Capitalism is an economic system An economic system, or economic order, is a system A system is a group of interacting Interaction is a kind of action that occurs as two or more objects have an effect upon one another. The idea o ...

capitalism
, Sombart writing in "Medieval and Modern Commercial Enterprise" that: :The very concept of capital is derived from this way of looking at things; one can say that capital, as a category, did not exist before double-entry bookkeeping. Capital can be defined as that amount of wealth which is used in making profits and which enters into the accounts."
Karl Marx Karl Heinrich Marx (; 5 May 1818 – 14 March 1883) was a German philosopher A philosopher is someone who practices philosophy Philosophy (from , ) is the study of general and fundamental questions, such as those about reason, M ...

Karl Marx
adds a distinction that is often confused with
David Ricardo David Ricardo (18 April 1772 – 11 September 1823) was a British political economist, one of the most influential of the classical economists along with Thomas Malthus Thomas Robert Malthus (; 13/14 February 1766 – 23 December 1834) w ...

David Ricardo
's. In
MarxianMarxian is a term generally used to refer to things related to Karl Marx other than Marxism. It can refer to: * Marxian economics * Marxist philosophy * Marxian class theory See also

* Marxism, which is usually referred to as "Marxist", rathe ...
theory,
variable capital Constant capital (c), is a concept created by Karl Marx and used in Marxian economics, Marxian political economy. It refers to one of the forms of Capital (economics), capital invested in Production (economics), production, which contrasts with v ...
refers to a capitalist's investment in labor-power, seen as the only source of
surplus-value In Marxian economics, surplus value is the difference between the amount raised through a sale of a product and the amount it cost to the owner of that product to manufacture it: i.e. the amount raised through sale of the product minus the cost ...
. It is called "variable" since the amount of
value Value or values may refer to: * Value (ethics) In ethics Ethics or moral philosophy is a branch of philosophy Philosophy (from , ) is the study of general and fundamental questions, such as those about Metaphysics, existence, reason, E ...
it can produce varies from the amount it consumes, ''i.e.'', it creates new value. On the other hand,
constant capital Constant capital (c), is a concept created by Karl Marx Karl Heinrich Marx (; 5 May 1818 – 14 March 1883) was a German philosopher, economist, historian, sociologist, political theorist, journalist and socialist revolutionary. Born in Tri ...
refers to investment in non-human factors of production, such as plant and machinery, which Marx takes to contribute only its own
replacement value The term replacement cost or replacement value refers to the amount that an entity would have to pay to replace an asset at the present time, according to its current worth. In the insurance Insurance is a means of protection from financial ...
to the commodities it is used to produce.
Investment Investment is the dedication of an asset to attain an increase in value over a period of time. Investment requires a sacrifice of some present asset, such as time, money, or effort. In finance Finance is the study of financial institution ...

Investment
or
capital accumulation Capital accumulation (also termed the accumulation of capital) is the dynamic that motivates the pursuit of profit, involving the investment Investment is the dedication of an asset to attain an increase in value over a period of time. Inve ...
, in classical economic theory, is the production of increased capital. Investment requires that some goods be produced that are not immediately consumed, but instead used to produce other goods as
capital goods Capital most commonly refers to: * Capital letter, an upper-case letter in any type of writing * Capital city, the area of a country, province, region, or state, regarded as enjoying primary status, usually but not always the seat of the gover ...
. Investment is closely related to
saving Saving is income In microeconomics, income is the Consumption (economics), consumption and saving opportunity gained by an entity within a specified timeframe, which is generally expressed in monetary terms.Smith's financial dictionary. Smit ...
, though it is not the same. As
Keynes John Maynard Keynes, 1st Baron Keynes, ( ; 5 June 1883 – 21 April 1946) was an English economist An economist is a professional and practitioner in the social science Social science is the Branches of science, branch of science de ...

Keynes
pointed out, saving involves not spending all of one's income on current goods or services, while investment refers to spending on a specific type of goods, ''i.e.'', capital goods.
Austrian School The Austrian School is a heterodox In religion, heterodoxy (from Ancient Greek Ancient Greek includes the forms of the Greek language used in ancient Greece and the classical antiquity, ancient world from around 1500 BC to 300 BC. It ...
economist Eugen Boehm von Bawerk maintained that
capital intensityCapital intensity is the amount of fixed or real capital Capital most commonly refers to: * Capital letter Letter case (or just case) is the distinction between the letters that are in larger uppercase or capitals (or more formally ''majus ...
was measured by the roundaboutness of production processes. Since capital is defined by him as being goods of higher-order, or goods used to produce consumer goods, and derived their value from them, being future goods.
Human development theory Human development is the process characterized by the variation of material conditions. These conditions influence the possibilities of satisfying needs and desires. They also explore and realize the physical and psychic, biological and cultural, in ...
describes human capital as being composed of distinct social, imitative and creative elements: *
Social capital Social capital is "the networks of relationships among people who live and work in a particular society, enabling that society to function effectively". It involves the effective functioning of social group In the social science Soc ...
is the value of network trusting relationships between individuals in an economy. *
Individual capital Individual capital, the economic view of talent, comprises inalienable or personal traits of persons, tied to their bodies and available only through their own free will Free will is the ability to choose between different possible courses of ...
, which is inherent in persons, protected by societies, and trades labour for trust or money. Close parallel concepts are " talent", "
ingenuity Ingenuity is the quality of being clever, original, and inventive, often in the process of applying ideas to solve problems or meet challenges. Etymology Ingenuity (Ingenium) is the root Latin word for engineering Engineering is the us ...

ingenuity
", "
leadership Leadership, both as a research area and as a practical skill, encompasses the ability of an individual, group or organization An organization, or organisation (English in the Commonwealth of Nations, Commonwealth English; American and B ...

leadership
", "trained bodies", or "innate skills" that cannot reliably be reproduced by using any combination of any of the others above. In traditional economic analysis individual capital is more usually called ''labour''. *
Instructional capital Instructional capital is a term used in educational administration after the 1960s, to reflect capital resulting from investment in producing learning materials. Education finance Capital (economics) {{education-stub ...
in the academic sense is clearly separate from either individual persons or social bonds between them. This theory is the basis of
triple bottom line The triple bottom line (or otherwise noted as TBL or 3BL) is an accounting Accounting or Accountancy is the measurement ' Measurement is the number, numerical quantification (science), quantification of the variable and attribute (research), ...
accounting and is further developed in
ecological economics Ecological economics, bioeconomics, ecolonomy, eco-economics, or ecol-econ is both a transdisciplinary Transdisciplinarity connotes a research strategy that crosses many disciplinary boundaries to create a holistic Holism (from Ancient Gre ...
,
welfare economics Welfare economics is a branch of economics that uses microeconomic Microeconomics is a branch of mainstream economics Mainstream economics is the body of knowledge, theories, and models of economics, as taught by universities worldwide, tha ...
and the various theories of
green economics A green economy is an economy An economy (from Greek language, Greek οίκος – "household" and νέμoμαι – "manage") is an area of the Production (economics), production, Distribution (economics), distribution and trade, as well as ...
. All of which use a particularly abstract notion of capital in which the requirement of capital being produced like durable goods is effectively removed. The
Cambridge capital controversy The Cambridge capital controversy, sometimes called "the capital controversy"Brems (1975) pp. 369-384 or "the two Cambridges debate", was a dispute between proponents of two differing theoretical and mathematical positions in economics E ...
was a dispute between economists at Cambridge, Massachusetts based MIT and University of Cambridge in the UK about the measurement of capital. The Cambridge, UK economists, including
Joan Robinson Joan Violet Robinson (''née'' Maurice; 31 October 1903 – 5 August 1983) was a British economist An economist is a practitioner in the social sciences, social science discipline of economics. The individual may also study, develop, and ...
and
Piero Sraffa Piero Sraffa (5 August 1898 – 3 September 1983) was an influential Italian economist An economist is a professional and practitioner in the social science Social science is the branch A branch ( or , ) or tree branch (sometime ...
claimed that there is no basis for aggregating the heterogeneous objects that constitute 'capital goods.' Political economists
Jonathan Nitzan Jonathan Nitzan is Professor of Political Economy at York University York University (french: Université York) is a public In public relations and communication science, publics are groups of individual people, and the public (a.k.a. the ...
and
Shimshon Bichler Shimshon Bichler is an educator who teaches political economy at colleges and universities in Israel Israel (; he, יִשְׂרָאֵל; ar, إِسْرَائِيل), officially known as the State of Israel ( he, מְדִינַת יִשְ ...
have suggested that capital is not a productive entity, but solely financial and that capital values measure the relative power of owners over the broad social processes that bear on profits.''Capital as Power: A Study of Order and Creorder'', Routledge, 2009, p, 228.


See also

*
Capital deepening Capital most commonly refers to: * Capital letter Letter case (or just case) is the distinction between the letters that are in larger uppercase or capitals (or more formally ''majuscule'') and smaller lowercase (or more formally ''minusc ...
* Capitalist mode of production * ''
Das Kapital ''Das Kapital'', also known as ''Capital: A Critique of Political Economy'' or sometimes simply ''Capital'' (german: Das Kapital. Kritik der politischen Ökonomie, ; 1867–1883), is a foundational theoretical text in materialist philosophy, ...

Das Kapital
'' *
DIRTI 5 In accounting Accounting or Accountancy is the measurement ' Measurement is the number, numerical quantification (science), quantification of the variable and attribute (research), attributes of an object or event, which can be used to compare ...
*
Means of production The means of production is a concept that encompasses the social use and ownership Ownership is the state or fact of exclusive right In Anglo-Saxon law Anglo-Saxon law (Old English Old English (, ), or Anglo-Saxon, is the earliest record ...
*
Organic composition of capital The organic composition of capital (OCC) is a concept created by Karl Marx in his theory of capitalism, which was simultaneously his critique of the political economy of his time. It is a special concept derived from his more basic concepts of 'v ...
* Organizational capital * '' The Accumulation of Capital'' *
Venture capital Venture capital (VC) is a form of private equity Private equity (PE) typically refers to investment funds, generally organized as limited partnerships, that buy and restructure companies that are not publicly traded. Private equity is a ty ...
*
Wealth (economics) Wealth is the abundance of valuable financial asset A financial asset is a non-physical asset In financial accounting Financial accounting is the field of accounting Accounting or Accountancy is the measurement, processing, and comm ...


References


Further reading

* * * Pistor, K. (2020). ''Code of Capital: How the Law Creates Wealth and Inequality'', Princeton University,


External links

* * {{Authority control Capitalism