What is Capital?

Legal Definition
In economics, capital goods, real capital, or capital assets are already-produced durable goods or any non-financial asset that is used in production of goods or services.

Adam Smith defines capital as "That part of a man's stock which he expects to afford him revenue". Capital is derived from the Latin word "caput" meaning head, as in "head of cattle". The term "stock" is derived from the Old English word for stump or tree trunk. It has been used to refer to all the moveable property of a farm since at least 1510. In Middle Ages France contracted leases and loans bearing interest specified payment in heads of cattle.

How a capital good is maintained or returned to its pre-production state varies with the type of capital involved. In most cases capital is replaced after a depreciation period as newer forms of capital make continued use of current capital non profitable. It is also possible that advances make an obsolete form of capital practical again.

Capital is distinct from land (or non-renewable resources) in that capital can be increased by human labor. At any given moment in time, total physical capital may be referred to as the capital stock (which is not to be confused with the capital stock of a business entity).

In a fundamental sense, capital consists of any produced thing that can enhance a person's power to perform economically useful work—a stone or an arrow is capital for a caveman who can use it as a hunting instrument, and roads are capital for inhabitants of a city. Capital is an input in the production function. Homes and personal autos are not usually defined as capital but as durable goods because they are not used in a production of saleable goods and services.

In Marxist political economy, capital is money used to buy something only in order to sell it again to realize a financial profit. For Marx capital only exists within the process of economic exchange—it is wealth that grows out of the process of circulation itself, and for Marx it formed the basis of the economic system of capitalism. In more contemporary schools of economics, this form of capital is generally referred to as "financial capital" and is distinguished from "capital goods".
-- Wikipedia
Legal Definition
The available assets of a business, including liquid assets (cash) and/or physical assets (machinery, buildings, and equipment).
Legal Definition
Political economy, commerce. In political economy, it is that portion of the produce of a country, which may be made directly available either to support the human species or to the facilitating of production.

2. In commerce, as applied to individuals, it is those objects, whether consisting of money or other property, which a merchant, trader, or other person adventures in an undertaking, or which he contributes to the common stock of a partnership. 2 Bouv. Inst. n. 1458.

3. It signifies money put out at interest.

4. The fund of a trading company or corporation is also called capital, but in this sense the word stock is generally added to it; thus we say the capital stock of the Bank of North America.
-- Bouviers Law Dictionary
Legal Definition
n. In political economy, that portion of the produce of industry existing in a country, which may be made directly available, either for the support of human existence or the facilitating of production; but, in commerce, and as applied to individuals, it is understood to mean the sum of money which a merchant, banker or trader adventures in any undertaking or which he contributes to the common stock of a partnership. Also the fund of a trading company or corporation, in which sense the word "stock" is generally added to it. Pearco v. Augusta, 37 Ga. 599; Eeople v. Feitner, 56 App. Div.'280, 67 N. Y. Supp 893; Webb v. Armistead (C. C.) 26 Fed. 70.

The actual estate, whether in money or property, which is owned by an Individual or a corporation. In reference to a corporation, it is the aggregate of the sum subscribed and paid in, or secured to be paid in, by the shareholders, with the addition of all gains or profits realized in the use and investment of those sums, or, if losses have been incurred, then it is the residue after deducting such losses. See Capital Stock. When used with respect to the property of a corporation or association, the term has a set-lied meaning.

It applies only to the property or means contributed by the stockholders as the fund or basis for the business or enterprise for which the corporation or association was formed. As to them the term does not embrace temporary loans, though the moneys borrowed be directly appropriated in their business or undertakings. And, when used with respect to the property of individuals in any particular business, the term has substantially the same import ; it then means the property taken from other investments or uses and set apart for and invested in the special business, and in the increase, proceeds, or earnings of which property beyond expenditures incurred in its use consist the profits made in the business. It does not, any more than when used with respect to corporations, embrace temporary loans made in the regular course of business. Bailey v. Clark, 2l Wall. 286, 22 L. Ed. 651.

The principal sum of a fund of money; money Invested at interest. Also the political and governmental metropolis of a state or country; the seat of government; the place where the legislative department holds its sessions, and where the chief offices of the executive are located.
-- Black's Law Dictionary
Legal Definition
adj. Affecting or relating to the head or life of a person; entailing the uitimate penalty. Thus, a capital crime is one punishable with death. Walker v. State, 28 Tex. App. 503, 13 S. W. 860; Ex parte McCrary, 22 Ala. 72; Ex parte Dusenberry, 97 Mo. 504, U S. W. 217. Capital punishment is the punishment of death. Also principal; leading; chief; as "capital burgess." 10 Mod. 100.
-- Black's Law Dictionary
Legal Definition
The property and money invested in a business; affecting human life. See 37 Ga. 597.
-- Ballentine's Law Dictionary