Capital in the economy is a fundamental phenomenon

Today we will discuss the role of capital in the economy. Next, the meaning of this term will be given. Also, the conversation will touch on the importance of this phenomenon in the production of services and goods and in a market economy.

Definition

So, now we will talk in detail about what capital is. The definition of this term is the first thing that should be paid special attention. This phenomenon is usually called net assets. The term originates from the word capitalis (it is of Latin origin). This concept can be translated as "main".

Capital in the economy is a term that refers primarily to property. Also, net assets represent a group of goods that are used to generate profits and, as a result, achieve wealth.

We give a narrower definition. According to him, capital in the economy is a source of profit, which has the form of means of production. This definition is most widely described in terms of net physical assets.

Specialists also singled out money capital. It is the sum of money. With its help, physical capital is acquired. Money and material values are continuously invested in the economy of an individual state. This phenomenon is called investment. It is also defined as capital investment. Note that net assets are not consumed resources.

In science

Capital in the economy - is the resources that are used in the provision of services or the manufacture of goods. In this case, the means of production play a special role. It becomes physical capital. The means of production are assets only in combination with the owner of a certain workforce.

An example is a machine tool for cutting metal. The unit itself is not capable of bringing the owner any income. The equipment turns into a part of own means at hiring of the worker. He will control the machine. Also the owner can lease the unit.

Physical assets appear in the economy when the owner of the funds finds labor. As a result, he hires a person to manage the equipment that is owned. Capital is not an object or thing. In fact, it is rather a production equivalent embodied in an object. He is given specific characteristics.

Capital is an indispensable element of a market economy. This resource is necessary for production. Own means include material values, as well as property. Among them one should mention the raw materials for the creation of the final goods, constructions, equipment, units. Capital is an economic resource that brings income to the owner. Simplifying the economic theory, one's own resources can be called all the resources that allow you to make a profit. Most often, a monetary equivalent is used to estimate the amount of capital. Using your own funds, you can create a business to subsequently earn a profit and income.

Net assets are also used to increase the volume of production at the existing enterprise. The source of change and the emergence of capital are savings. They are of great importance.

Organization

We should also discuss "Russian capital" as a proper name. In this case we are talking about a bank. It provides services to all categories of customers. Bank "Russian Capital" was established in 1993. It is part of the deposit insurance system. The activities of the organization are controlled by the Central Bank of the Russian Federation. Yu. O. Isaev is the Chairman of the Board of Directors.

Authorized capital

In this case, we will talk about companies. Different subjects of economic activity have personal initial means. They are called a statutory fund. It is formed due to the contributions of the founders of the company. The capital of the organization includes different assets. In particular, it may include funds allocated by local or state authorities; Share deposits; Investments of founders; Shares. Also, backup and additional funds can work and form.

Maternal capital

It is a question of a certain form of assistance to families in which there are children. It comes from the state. In Russia, such financial support has been practiced since 2007. It is allocated to families who have two or more children. At the same time one of the parents is given the appropriate certificate. Such a document allows receiving state aid. The funds are transferred only by bank transfer. Parents receive the right to dispose of the child's money only after reaching the age of three. In special circumstances, you can get consent to use these tools immediately after the birth of the baby.

In conclusion, it can be said that capital in the economy is its integral part and one of the main resources.