Definition of Capital

The meaning of “capital” is one of those slippery concepts that change somewhat depending upon the context. It’s probably more confusing than not that all these meanings are closely related. Despite that, in each context the significance of capital is unique.

The General Meaning of “Capital”

In everyday speech, “capital” is used freely to denote something like (but not quite the same as) “money.” A rough equivalent might be “monetary wealth” — which distinguishes it from other forms of wealth: land and other property, for example. This is different from its meanings in finance, accounting and economics.

This isn’t a call for more precise use of language in informal discourse — in these situations this rough understanding of the meaning of “capital” will suffice. In specific areas, however, the meaning of the word becomes both more limited and more precise. Read More

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