ForĮxample, if a country's total capital stock is the equivalent of six years of national income, we write β = 6 This gives us the capital/income ratio, which I denote by the Greek letter β. How to calculate capital stock in a particular country? The most natural and useful way to measure the capital stock in a particular country is to divide that stock by theĪnnual flow of income. (bank accounts, mutual funds, bonds, stocks, financial investments of all kinds, insurance policies, pensionįunds, etc.), less the total amount of financial liabilities (debt). Market.8 It consists of the sum total of nonfinancial assets (land, dwellings, commercial inventory, otherīuildings, machinery, infrastructure, patents, and other directly owned professional assets) and financial assets

The residents and government of a given country at a given point in time, provided that it can be traded on some Definition of national wealth or national capital? I define 'national wealth' or 'national capital' as the total market value of everything owned by Capital includes all forms of real property (including residential real estate) as wellĪs financial and professional capital (plants, infrastructure, machinery, patents, and so on) used by firms and In this book, capital is defined as the sum total of nonhuman assets that can be owned andĮxchanged on some market. Often call (unfortunately, to my mind) 'human capital,' which consists of an individual's labor power, skills, Definition of capital? throughout this book, when I speak of 'capital' without further qualification, I always exclude what economists Whether net income from abroad is positive or negative. How can national income be greater or smaller than GDP? a country's national income may be greater or smaller than its domestic product, depending on

Capital in the twenty first century