capital consumption

the reduction in a country's CAPITAL STOCK incurred in producing this year's GROSS NATIONAL PRODUCT (GNP). In order to maintain (or increase) next year's GNP, a proportion of new INVESTMENT must be devoted to replacing worn-out and obsolete capital stock. Effectively, capital consumption represents the aggregate of firms’ DEPRECIATION charges for the year.

Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005

Mentioned in

capital accumulation
capital stock
depreciation
gross domestic fixed-capital formation
investment
national income
national income accounts
national product
net domestic product
net national product
replacement investment
wear and tear

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