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    Macroeconomics

    Capital formation

    Capital formation

    Capital formation is the macroeconomic process and statistical measure that records additions to an economy’s produced assets. In national accounts it is tracked primarily through gross capital formation—comprising gross fixed capital formation, changes in inventories, and acquisitions less disposals of valuables—serving as the main expenditure-side indicator of investment. The concept underpins analyses of growth, savings–investment dynamics, and the evolution of the capital stock.