capital formation

Cultural  

1. The creation of capital. For example, capital is created when banks lend the money they hold in savings accounts to firms that use the money to purchase machinery.

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Example Sentences

Equity investments by well-governed merchant-banking subsidiaries in local businesses boost capital formation; those from private-equity companies all too often favor high-risk speculation.

From Barron's • Dec. 19, 2025

Boland says revenue was driven by a strong performance in several segments, including derivative trading, TMX Trayport, capital formation, and TMX VettaFi.

From The Wall Street Journal • Oct. 29, 2025

Investments by companies in assets such as factories, machinery or construction – also called gross fixed capital formation – make up around 30% of GDP and are its second largest contributor following private consumption.

From BBC • Mar. 26, 2025

Gross fixed capital formation added 0.1 points and net trade a further 0.7 points as imports declined.

From Reuters • Jun. 8, 2023

This factor is the mobilisation of capital and the consequent separation of the process of capital formation from the process of capital-using.

From Freeland A Social Anticipation by Hertzka, Theodor