Capital Formation and Economic Development

Dr. Sultan Ahmad Taraki, Dr. Mesut Murat Arslan

Abstract: Different theories of economic growth and development have approved that There is positive relation between capital formation and economic development. The main objective of economic development is the formation of economic and social overhead capital (or cost) in the economies. Public capital formation can directly influence the rate and productivity of private sector capital formation, and private sector capital formation in the form of new business formation has both direct and indirect impact on economic development.

Keywords: Capital Formation, Balanced Capital Formation, Unbalanced Capital Formation, Impacts of Capital Formation