Wealth is a store of value. This includes things that have value, create future value or that can be used to pay future expenses. Wealth can be measured for nations, communities, organizations, families and individuals. The following are illustrative examples of wealth.
Capital is property that produces value such as a factory, data center or bridge.Nature itself is a form of capital that is often a common good that isn't owned by anyone. For example, the oceans and atmosphere are natural capital.
GovernmentsGovernments are a form of wealth assuming that they provide valuable services that meet the needs of a nation.
MoneyThe legal currency of a nation secured by its ability to collect future taxes.
CommoditiesPrecious commodities such as gold and silver.
OrganizationsBusinesses and non-profit organizations that produce value.
Securities Tradable financial assets such as stocks.
Real EstateProperty, buildings, structures and land improvements.
Physical things that have value such as infrastructure or products.A non-physical entity that has value such as a brand. This includes digital assets such as software and data.
Intellectual PropertySymbols and creative works such as copyrights, patents, trade secrets and trademarks.
Cultural things such as a historical building or work of art.The talent of an individual that has potential to produce future value. Likewise, an educated population is a component of the wealth of nations. This is often referred to as "human capital."
HealthThe health of an individual is valuable to them. It also tends to increase future productivity.
The value of social relationships to a firm or individual such as a brand with many advocates or a salesperson with many contacts.Cultural capital is the ability of an individual to influence within the context of a culture or social group. For example, a sales person who knows how to influence German technology CEOs.
Economic security is the ability of a system to sustain a standard of living. For example, capabilities in areas such as water security and disaster preparedness can be considered wealth.Anything that makes people more satisfied with life such that it has value to them. All else being equal, a city where people are generally happy is arguably more wealthy than a city where everyone is unhappy.
Traditional WealthTraditionally, wealth is defined as an asset that can be used to pay future expenses. This includes capital and infrastructure that generates value. It also includes assets such as real estate, securities, precious metals and cash. Anything that is difficult to place a cash value on such as quality of life aren't traditionally considered wealth. Intangible assets aren't traditionally included as wealth unless you bought them from someone, thus establishing a cash value.
Net WealthNet wealth are the total financial and non-financial assets of an entity minus all liabilities such as debt. This is based on traditional wealth such that only things with an unambiguous dollar value are included.
This is the complete list of articles we have written about finance.
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