capital goods: meaning, definition, pronunciation and examples
C2Formal, Technical, Business, Academic (Economics)
Quick answer
What does “capital goods” mean?
Physical assets, such as machinery, factories, and equipment, used by a company to produce other goods and services.
Audio
Pronunciation
Definition
Meaning and Definition
Physical assets, such as machinery, factories, and equipment, used by a company to produce other goods and services.
Durable goods that are not consumed directly but are used in the production of consumer goods or other capital goods, representing long-term investments in production capacity.
Dialectal Variation
British vs American Usage
Differences
No significant lexical differences. Usage is identical in both economic and business contexts.
Connotations
Neutral technical term in both varieties.
Frequency
Equally frequent in relevant professional/academic discourse in both regions.
Grammar
How to Use “capital goods” in a Sentence
Noun + preposition 'in' (investment in capital goods)Verb + Object (manufacture/produce/import capital goods)Adjective + Noun (domestic/foreign capital goods)Vocabulary
Collocations
Examples
Examples of “capital goods” in a Sentence
adjective
British English
- The capital-goods sector showed growth.
- A capital-goods investment programme.
American English
- The capital goods industry is booming.
- A capital goods manufacturing plant.
Usage
Meaning in Context
Business
Discussions of company investment, balance sheets, and production capacity.
Academic
Core term in macroeconomics and development economics.
Everyday
Rarely used; replaced by simpler terms like 'machinery' or 'equipment'.
Technical
Precise classification in national accounts (e.g., GDP calculation) and trade statistics.
Vocabulary
Synonyms of “capital goods”
Strong
Neutral
Weak
Vocabulary
Antonyms of “capital goods”
Watch out
Common Mistakes When Using “capital goods”
- Using it as a singular noun ('a capital good' is possible but highly technical and rare).
- Confusing with 'consumer durables' (e.g., washing machines for home use).
FAQ
Frequently Asked Questions
Yes, if it is used by a business (e.g., a courier company) to provide a service. It is a durable asset used in production.
Capital goods (like an oven) are used repeatedly over years to produce goods. Raw materials (like flour) are used up and transformed in a single production cycle.
In modern economics, yes. If software (e.g., a factory design program) is a long-term productive asset for a business, it is considered an intangible capital good.
Investment in capital goods is a key driver of long-term economic growth and productivity, as it expands a country's capacity to produce.
Physical assets, such as machinery, factories, and equipment, used by a company to produce other goods and services.
Capital goods is usually formal, technical, business, academic (economics) in register.
Capital goods: in British English it is pronounced /ˌkæp.ɪ.təl ˈɡʊdz/, and in American English it is pronounced /ˌkæp.ə.t̬əl ˈɡʊdz/. Tap the audio buttons above to hear it.
Phrases
Idioms & Phrases
- “The engine of industry (metaphorically related)”
Learning
Memory Aids
Mnemonic
Imagine a CAPITAL city where the main buildings are not houses but huge FACTORIES (goods producers). Capital goods are the factory 'buildings' and machines for making other things.
Conceptual Metaphor
THE ECONOMY IS A MACHINE (capital goods are the parts/components of that machine).
Practice
Quiz
Which of the following is the best example of a capital good?