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Capital accumulation facts for kids

Kids Encyclopedia Facts

Capital accumulation means the gathering of objects of value; the increase in wealth; or the creation of wealth. In this context capital can be understood as assets used for profit.

In economics capital accumulation is often seen as the same as investment.

But capital accumulation can refer as well to

  • real investment in tangible means of production.
  • financial investment in paper assets.
  • investment in non-productive physical assets such as residential real estate that appreciate in value.
  • "human capital accumulation," i.e., new education and training increasing the skills of the (potential) labour force.

Non-financial capital accumulation is an essential factor for economic growth, since additional investment is essential to enlarge the scale of production and increase employment opportunities.

Rosa Luxemburg insisted that capital accumulation is the cause of the imperialism on her essay ""The Accumulation of Capital".

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Capital accumulation Facts for Kids. Kiddle Encyclopedia.