Statistical Terms Glossary

The transfer of technical knowledge and skills to host nation individuals and institutions to help them develop effective policies and administer state services across the economic, social, political, and security realms.

Where overcapacity exists, decommissioning boats may not be more than a temporary solution.; Increases in capacity achieved with little or no capital expenditure.

The capital account records acquisitions less disposals of non-financial assets by resident units and measures the change in net worth due to saving (final balancing item in the current accounts) and capital transfers.

The capital account is the first of four accounts dealing with changes in the values of assets held by institutional units. It records transactions in non-financial assets.

The capital adequacy ratio is the central feature of the Basel Capital Accord. It is an analytical construct in which regulatory capital is the numerator and risk-weighted assets is the denominator. The minimum ratio of regulatory capital to risk-weighted assets is set at 8 percent (the core regulatory capital element should be at least 4 percent). These ratios are considered the minimum necessary to achieve the objective of securing over time soundly-based and consistent capital ratios for all international banks.

Capital adequacy rules relate to the minimum amount of capital (equity) that institutions must hold relative to their assets set by financial market regulators. These rules are designed to ensure that capital is sufficient to absorb likely losses. It was agreed at the Bank for International Settlements in 1988 that the minimum ratio of capital to risk-adjusted assets for international banks should be 8 per cent

Capital and reserves is the difference between total assets and total liabilities in the balance sheet. It represents the equity interest of the owners in an entity and is the amount available to absorb unidentified losses.

Sustainable development is development that ensures non-declining per capita national wealth by replacing or conserving the sources of that wealth; that is, stocks of produced, human, social and natural capital.

A mathematical model that attempts to explain how securities should be priced, based on their relative riskiness in combination with the return on risk-free assets. The model yields beta.

Total capital of an organization, i.e. capital plus reserves.

See Consumption of fixed capital - SNA.

Action which increases the relative value of capital in relation to labor (see capital widening).

Investment aimed at increasing production efficiency and lowering costs.

Capital expenditure measures the value of purchases of fixed assets, i.e. those assets that are used repeatedly in production processes for more than a year. The value is at full cost price. Sales of fixed assets are not deducted

Capital expenditure represents the value of educational capital acquired or created during the year in question, that is, the amount of capital formation, regardless of whether the capital outlay was financed from current revenue or by borrowing.
Capital expenditure includes outlays on construction, renovation, and major repair of buildings and expenditure for new or replacement equipment. Although capital investment requires a large initial expenditure, the plant and facilities have a lifetime that extends over many years.

Capital expenditure for environmental protection corresponds to gross capital formation by producers of environmental protection services and other capital formation in specific products.

Capital flight may be defined as transfer of assets denominated in a national currency into assets denominated in a foreign currency, either at home or abroad, in ways that are not part of normal transactions. (Abalkin and Walley (1999) – ref. Handbook Chapter 10)

Is also known as 'holding gains'. Positive or negative nominal holding gains accrue during the accounting period to the owners of assets and liabilities as a result of a change in their prices. Holding gains are sometimes described as “capital gains”.

Issue price of par (100 percent) with redemption at a multiple of that amount.

Analysts in the media commonly refer to "capital injections" made by the government in a public corporation, when some financial support is provided. The notion of "capital injection" as such is not defined in the SNA93 and in the ESA95. In the media, it may cover any payment from government to a public corporation having the characteristics of either a capital transfer or a financial transaction in national accounts.

Measure of the capital component of the production process. Present valued equivalents are needed to compare units of differing ages. The insurance, book or replacement value of vessels are all possible estimators of investment value. The opportunity cost of capital could also be considered. (GFCM:WP/98/3)

Issue of securities to finance capital outlays.

Capital levies consist of taxes on the values of the assets or net worth owned by institutional units levied at irregular, and very infrequent, intervals of time

The market for buying and selling long-term loanable funds, in the form of bonds, mortgages and the like. Unlike the money market, where short-term funds are traded, the capital market tends to center on well-organized institutions such as the stock exchange. However, there is no clearcut distinction between the two other than that capital market loans are generally used by businesses, financial institutions and governments to buy capital goods whereas money-market loans generally fill a temporary need for working capital.

Special account held by a corporation to repurchase part of its shares.

Capital repairs including restoration and conversions includes, in principle, all construction work performed for others and intended to extend the normal economic life or to increase the productivity of existing structures

Capital services refer to the flow of productive services provided by an asset that is employed in production. Capital services reflect a (physical) quantity, not to be confused with the value, or price concept of capital. Capital services are the appropriate measure of capital input in production analysis.