The capital is a property employed for the purpose of productive consumption; to avoid a waste, the entrepreneur put a stock of economic goods to use. The function of capital is to discharge itself in its activity and to accumulate eventually as a by-product of the process – which is however a rent. Entrepreneurs deplete the accumulated stock of goods in order to utilise the existing property, according to the principle of efficiency. For optimal productivity, the chain of goods is exclusively extended for the purpose of delayed consumption. The capitalist effort defers the completion of production by multiplying the means of productive consumption.
Historical Backdrop
• ANNE-ROBERT-JACQUE TURGOT Reflections on the Formation and Distribution of Wealth: reserve of produce.
• ADAM SMITH The Wealth of Nations: capital as a stock of goods.
• JOHN STUART MILL The Principles of Political Economy: capital.
• IRVING FISHER The Nature of Capital and Income: capital-wealth.
• CARL MENGER Principles of Economics: hierarchy of goods.
• EUGEN VON BOHM-BAWERK Positive Theory of Capital: capital.
• KNUT WICKSELL Lectures on Political Economy: produced means of production.