# capital

**Definition**  
Capital is the accumulated stock of assets—such as machinery, tools, raw materials, and financial resources—used to produce commodities. It is a factor of production that enables labour to generate output and is the basis for profit generation.

**Source Chapter**  
*The Wealth of Nations*, Book 1, Chapter 6.

**Context**  
Smith refers to capital when explaining that “the profits of stock … are greater or smaller in proportion to the extent of this stock,” and when he discusses the “capital which employs the weavers.” Capital is presented as the underlying resource that determines the scale of profit.

**Economic Domain**  
Accumulation

**Smith’s Original Wording**  
> “The capital which employs the weavers … must be greater than that which employs the spinners … because it not only replaces that capital with its profits, but pays, besides, the wages of the weavers.”

**Modern Interpretation**  
Capital corresponds to the modern economic concept of physical and financial capital, a primary input in production functions (e.g., Cobb‑Douglas) and a driver of economic growth through investment.
