Physical Capital

Definition

Physical capital refers to the tangible assets, such as machinery, equipment, buildings, and infrastructure, that are used in the production of goods and services.

Related terms

Financial Capital: Financial capital refers to the funds or money that businesses use to purchase physical capital and other resources.

Technology: Technology refers to the knowledge and techniques used in production processes. It can improve efficiency by enhancing physical capital.

Infrastructure: Infrastructure includes the basic facilities necessary for an economy to function effectively, such as roads, bridges, power plants, and communication networks.