Talk:Capital accumulation

This article is simply wrong

In economics capital accumulation is an aggregate increase of "capital stock" (where stock is employed tangible assets as opposed to shares of stock of paper money). The term may be used to refer to an the entire economy. The term may also refer to individual instances of capital stock or capital goods within a firm or as owned by a person or a government. But in such cases it still refers to an expansion in the total amount of productive capacity (perhaps including knowledge (human capital)) within the particular context being addressed.

This article as currently written leans far too much toward "financial capital" as opposed to actual capital goods. And it is being called "Marxist" for that reason. to wit: "Definition of Capital on Marxists.org" .The Trucker (talk) 21:33, 2 September 2015 (UTC)

glad I'm not the only one who thought this! capital in economics or classical economics refers to manmade factors of production. like factories, or even a taxi cab, or a farmer's hoe. you have the famous triad of land, labour, and capital, with land actually meaning natural resources. capital accumulation is the process by which capital increases over time, for example by savings being channeled via investment into additional capital or by revenue being reinvested in additional capital for the firm.

but yah the vast majority of this article is trash, because apparently the others do not understand the meaning of capital in economics.

and then you have the section like : Demand-led growth models

where all of a sudden they start using the economic definition of capital Meistro1 (talk) 01:39, 30 November 2023 (UTC)

also capital accumulation is an economic process, it has no "aim". Meistro1 (talk) 13:14, 22 September 2024 (UTC)

let me propose an alternative opening

Definition :

In economics, capital refers to any man made factor of production. The earliest forms of capital were prehistoric and perhaps even predating homo sapiens themselves. When homo erectus fashioned crude hand axes for chopping wood or other productive endeavours, capital entered the world.

The classic triad in economics is land, labour, and capital. Here land refers to any sort of natural resources and labour is the expenditure of effort by individuals. Since antiquity, man has been innovating and employing additional forms of technology to increase the efficiency of his labour. This accumulation of capital, along side technological development has led to a steady increase in production and thus continually higher standards of living as well as higher levels of savings and investment.

With the industrial revolution and the massive increase in production associated with the factory system, capital accumulation began to increase exponentially. This translated into a massive increase in workers wages and greatly improved working conditions over the course of many long, hard decades or even centuries in the English case. Industrialization started with England in the mid 18th century, but did not really get under way in American manufacturing until the late 19th century. Meistro1 (talk) 01:56, 30 November 2023 (UTC)

Image

@Avatar317: Written by those involved in the protest: How is this moral or benefitting the common good? Have we not learned yet that economic systems which promote self wealth accumulation at all costs, without regards to the well-being of workers and the earth, have caused the very predicament we are now in? Why are we so willing to trust solutions from institutions that contributed to the problem?, 1. Des Vallee (talk) 07:01, 20 December 2024 (UTC)

It then later goes on to opposition on capital accumulation and what the protests intended to do. Des Vallee (talk) 07:02, 20 December 2024 (UTC)

That's an OPINION piece by ONE person, NOT a journalist DESCRIBING the protest. ---Avatar317^(talk) 22:26, 20 December 2024 (UTC)

@Avatar317: The source is not an someone's random opinion, it's a reliable source (Lutheran World Federation), from a reliable author. Regardless you are right that it is still an opinion piece. With that in mind there is better images such as this one, which has a direct reference to wealth inequality between the 99% and 1% and has a hyperlink in the form of "We are the 99%," therefore I feel that image could be used in the effects section. Thoughts? Des Vallee (talk) 05:38, 22 December 2024 (UTC)

I still don't feel that the Chicago janitors image is helpful either; the words and idea of "Capital accumulation" are never mentioned or displayed in that image.

Something to understand is that Wealth Inequality (We are the 99%) is DIFFERENT from Capital Accumulation. CA is a central concept to Capitalism, but it doesn't inherently mean that those who accumulate wealth will have to have extreme levels of wealth. Anyone who has retirement savings and invests it is participating in CA, including lots of union members with pensions. ---Avatar317^(talk) 06:21, 22 December 2024 (UTC)

The effects of wealth accumulation towards wealth inequality is the specific focus on that section, and so the image would be part of that. The image doesn't need to be an overall perfect descriptor of the article because not the lede image. Des Vallee (talk) 12:05, 23 December 2024 (UTC)

As another comment about your re-instating that content, here's another way to understand the difference between Capital Accumulation and Wealth Accumulation: A capital gains tax of 60% applied only to individuals who have more than $10M in net worth would reduce the rate of Wealth Accumulation, but have no effect on Capital Accumulation. ---Avatar317^(talk) 00:10, 4 January 2025 (UTC)

@Avatar317: Ok I am giving this a request for comment. The text of effects don't state that capital accumulation is wealth accumulation/inequality, but that capital accumulation leads to wealth inequality, which it does. Wealth accumulation, and capital accumulation are the synonyms. There is no source for this, and I can't find any sources that describe "wealth accumulation" and "capital accumulation" differently or use the definition you just stated. Cambridge states capital accumulation can both refer to personal accumulation of wealth, and the source it uses the Atlantic uses the term "capital accumulation" to refer to individual wealth gain There is a real danger that inequality is not just related to literal capital accumulation, but to equality of opportunity and the accumulation of cultural capital. This is referring to an individuals wealth not the overall amount of wealth in society. Finding results for "Wealth accumulation vs capital accumulation," doesn't show there is any difference between the two, and sources like this use the term interchangeably, and use capital accumulation to refer to increase of value of a specific company, stock or individual. Des Vallee (talk) 01:34, 4 January 2025 (UTC)

You should start with finding better sources, like economics textbooks, NOT sources like you linked above: "ccim.com" whose motto is "Advancing Commercial Real Estate". There are almost NO use cases where that site would be a RS for Wikipedia. ---Avatar317^(talk) 06:40, 4 January 2025 (UTC)

@Avatar317: Great then you want to provide a source for your claim? It's about the usage of the term "capital accumulation" and "wealth accumulation" is used in interchangeably which that link does. Also this literally is a reliable source, it's Certified Commercial Investment Member. A Certified Commercial Investment Member (CCIM) is a recognized expert in the disciplines of commercial and investment real estate. The designation is awarded by the CCIM Institute, formerly known as Commercial Investment Real Estate Institute (CIREI) of the National Association of Realtors. You should look into sources before just calling them bad. Des Vallee (talk) 09:50, 4 January 2025 (UTC)

Wow! All I can say is that you have a very poor understanding of what makes a RS in Wikipedia. National Association of Realtors would never be considered a RS for this type of info. (Maybe for data on home purchases.) Try looking over WP:RSP for examples of RS's. You will not find professional organizations listed there as RS's. ---Avatar317^(talk) 19:05, 4 January 2025 (UTC)

@Avatar317: That is a reliable source for economics, I don't know what you are talking about this source is used from pages on politics (Dean Saunders), to universities (Aligarh Muslim University), to medicine (National Commission for Indian System of Medicine). This source is literally cited hundreds of times in Wikipedia so I guess you should remove them? Except it is a reliable source, and you can't just decide it's not for personal reasons.

Again where is "capital accumulation" and "wealth accumulation" ever two separate things. Please provide a source for it because so far you have demonstrated none and ignore sources (like the Atlantic article) that show they are the same phrase. This is the main point of your argument and you haven't shown anything. Des Vallee (talk) 08:33, 5 January 2025 (UTC)

The National Commission for Indian System of Medicine acronym is "CCIM," not the economics source. If you want another example of it being used however Bond lease has been based on a CCIM source since 2012. Also it's used only a few times in Wikipedia mispoke. Des Vallee (talk) 08:40, 5 January 2025 (UTC)

Also nar.realtor is a reliable source, because it is written by experts and also is used commonly throughout Wikipedia on economics articles like Affordable housing. Des Vallee (talk) 08:43, 5 January 2025 (UTC)

Wealth accumulation and capital accumulation

Is wealth accumulation and capital accumulation two separate topics? Des Vallee (talk) 01:34, 4 January 2025 (UTC)

• Yes - they are separate topics - please see my comments in the above discussion. ---Avatar317^(talk) 23:15, 4 January 2025 (UTC)

No - A cursory google search reveals the two terms used interchangeably in many academic papers on economics, with one source explicitly stating that they are the same: "From this we see capital accumulation is the same as wealth accumulation."

I have reviewed the above discussion and fail to see any reliable sources cited that point to them needing to be completely separate in the context of this article. Unidentifiability (talk) 04:58, 6 January 2025 (UTC)

Agree with Unidentifiability per above. Des Vallee (talk) 14:22, 6 January 2025 (UTC)

@Unidentifiability: How did you find this discussion to comment here? You are a new user with less than six months on Wikipedia and 46 edits, and no bot notification for RfC's. ---Avatar317^(talk) 01:31, 8 January 2025 (UTC)

While I'm unsure how this is relevant to the discussion, all requests for comment are publicly available at WP:RFC/A. Unidentifiability (talk) 01:40, 8 January 2025 (UTC)

That's true, but that didn't answer the question of how YOU found this discussion. And this is relevant because it is rather unusual for new editors to weigh in on RfC's. ---Avatar317^(talk) 02:14, 8 January 2025 (UTC)

That page is how I found this discussion. All editors are permitted to participate in RFCs. Let's move on to something relevant. Unidentifiability (talk) 03:13, 8 January 2025 (UTC)

Ok. You listed one person's THEORY about this rather than the normal usage of the terms. From your source: "What, then, is capital? Whereas wealth is all income discounted, capital is future income discounted. That is, K = W − Y 0 , where Y 0 is the income of the present period. However, since the present period may be viewed as infinitely short in time, Y 0 is approaching zero, thus rendering K = W, or capital may be viewed as the same as wealth. From this we see capital accumulation is the same as wealth accumulation."

If you READ some of the sources on your Google scholar search, you'd see that these are clearly different terms

1) Title: The Effects of the Capital Accumulation Ratio on Wealth [1]

The capital accumulation ratio (CAR) is commonly used in academic research as a measure of household portfolio quality. This study tested whether a higher initial CAR impacts change in wealth over a decade among households.

2) A Theory of Wealth Distribution and Accumulation By Mauro Baranzini

page 12: More specifically, the term 'wealth accumulation' is used to indicate the decisions of individuals or families to save for a specific objective, while the term 'capital accumulation' will, more generally, refer to the wider process through which a society increases its potential to produce a flow of goods and services.

Chapter 2: WEALTH ACCUMULATION AND INCOME DISTRIBUTION IN MODERN ECONOMIC THEORIES

Chapter 3: CAPITAL ACCUMULATION AND LONG TERM ECONOMIC DYNAMICS

3)[2] Galor and Moav (2004) show that income inequality raises economic growth when the main engine of economic development is capital accumulation. However, when credit constraints are binding, inequality dampens economic growth of those economies moving toward replacement of physical capital accumulation with human capital accumulation. In the first situation, inequality is beneficial because it is associated with channelling of resources toward owners of capital, who are characterized by higher marginal propensity to save. In the latter situation, credit constraints prevent investment in human capital, whereas equality enables it and promotes economic growth of countries endowed with high return to human capital relative to physical capital. Thus, the natural and legitimate question that follows is, What are the policy options that reduce income inequality? Clarke et al. (2013) argue that policy makers should know whether “finance” can be used as an instrument to reduce income inequality.

4) [3]According to Stiglitz (1969), capital accumulation is independent of wealth distribution only if we assume linearity in the consumption function...

I'm sure there are more, but these are the first ones in the Google scholar search you linked that aren't paywalled. ---Avatar317^(talk) 05:58, 8 January 2025 (UTC)

@Avatar317: This text doesn't support anything you are trying to claim You literally also post a direct rebuttal from own quotes Whereas wealth is all income discounted, capital is future income discounted, not that capital is collective wealth and Example text The first source is about Capital Accumulation Ratio, and it also disproves what you are saying, it is discussing an individual capital accumulation, not the sum of the wealth in society and you keep trying to state it's not. The "capital accumulation ratio" here is measuring the wealth of a family, not that of a society, so your attempting a redefining of the source. The source provided by Unidentifiability, is not someone's opinion it's a reliable source. "A Theory of Wealth Distribution and Accumulation By Mauro Baranzini" is the only source which could ever possibly back up your claim, but this is a single author and not the commonly used term of the source as shown with the other sources not using it, the source even mentions the fact that it's definition of "wealth" and "capital" are arbitrary not readily accepted "It may be argued that there is no generally accepted definition of wealth; rather there are a number of wealth concepts", on the exact same page 12. The third source never states capital accumulation refers only to collective wealth, and it doesn't even use it in the terms for collective wealth, as previously mentioned, the term "Wealth accumulation" and "capital accumulation" can both refer to individual wealth of society and the collective, depending on how it's used, and the source. The source is using the term "Capital accumulation" to individual accumulation of capital The recent Arab Spring revolutions, particularly in Tunisia and Egypt, exemplify this prediction, as inequality of income and of economic opportunity were among its triggering ingredients. Yet, reducing income inequality is not only important from a social stability and justice perspective, but also from a pure economic growth enhancing angle. Galor and Moav (2004) show that income inequality raises economic growth when the main engine of economic development is capital accumulation., the text is about individuals accumulating wealth, not a society accumulating wealth. Your fourth source is a good one, but it doesn't even use the term "Capital accumulation" to refer to collective wealth, it's referring to individuals owning large amounts of capital such as houses being unconnected to collective wealth distribution. It also cuts out randomly, that's because you didn't include the full text: According to Stiglitz (1969), capital accumulation is independent of wealth distribution only if we assume linearity in the consumption function. By contrast, in our model the non-linearity in the consumption function leads to a dependence of accumulation on how wealth is distributed among individuals. The very source you are using directly uses the term "capital accumulation" to refer to individual wealth accumulation not collective. It's a perfect rebuttal actually they acknowledge that their model factors in for the effects of capital accumulation differently, and then use the term wealth because are used interchangeably. Your definition is not the common usage of the term, by the vast majority of sources, and some of the quotes you literally added has proven this. Capital accumulation and wealth accumulation are synonyms, with differences being that capital accumulation refers to accumulation of assets that can generate income such as factories, companies, bonds, houses etc...

The difference between capital and wealth is that one can generate revenue on it's own (such as a house, or a mine being capital) and the other is purely valued at something. It isn't collective wealth of a society, it can be used in that term "the capital of a country," per example. But it's usually used to refer to individual wealth, such as "the individual owns a large amount of capital." So I don't know why you keep stating falsely that it is.

I think this discussion should be left over for a few more days, and then I think there should be stated if there is consensus to make the changes. Des Vallee (talk) 09:12, 8 January 2025 (UTC)