Economic Capital

Definition

Economic capital refers to the financial resources and assets that an individual or a group possesses, which can be used to generate income, acquire goods and services, and maintain or improve their standard of living. It is a key component of the broader concept of social stratification and inequality within a society.

5 Must Know Facts For Your Next Test

1. Economic capital is often the most visible and tangible form of capital, as it can be easily quantified and exchanged for goods and services.
2. Individuals and groups with higher levels of economic capital tend to have greater access to resources, opportunities, and social mobility.
3. The unequal distribution of economic capital is a key driver of social stratification and inequality, as it can perpetuate and exacerbate disparities in power, status, and access to resources.
4. Economic capital can be accumulated and inherited, leading to the intergenerational transmission of advantage and disadvantage.
5. The relationship between economic capital and other forms of capital, such as social and cultural capital, can create complex systems of inequality and social reproduction.

Review Questions

• Explain how economic capital relates to the concept of social stratification and inequality.
  • Economic capital is a central component of social stratification and inequality within a society. Individuals and groups with higher levels of economic capital, such as wealth, income, and assets, tend to have greater access to resources, opportunities, and social mobility. This unequal distribution of economic capital can perpetuate and exacerbate disparities in power, status, and access to resources, leading to the formation of social hierarchies and the entrenchment of inequality.
• Describe the relationship between economic capital and other forms of capital, such as social and cultural capital.
  • Economic capital is often intertwined with other forms of capital, such as social and cultural capital. Individuals and groups with higher levels of economic capital may have greater access to social networks and relationships (social capital) and may also possess more cultural knowledge, skills, and dispositions (cultural capital) that can be leveraged to maintain or improve their social and economic standing. This complex interplay between different forms of capital can create and reinforce systems of inequality, as individuals and groups with greater access to multiple forms of capital can accumulate advantages over time.
• Analyze how the intergenerational transmission of economic capital can contribute to the perpetuation of social inequality.
  • The ability to accumulate and inherit economic capital can lead to the intergenerational transmission of advantage and disadvantage, further entrenching social inequality. Individuals born into families with higher levels of economic capital may have greater access to resources, educational opportunities, and social networks that can help them maintain or improve their economic status. Conversely, those born into families with lower levels of economic capital may face significant barriers to social mobility, as they lack the financial resources and social connections necessary to access the same opportunities. This cycle of intergenerational transmission of economic capital can contribute to the perpetuation of social stratification and the entrenchment of inequality within a society.

Related terms

Social Capital: The networks, connections, and relationships that an individual or group can leverage to access resources and opportunities.

Cultural Capital: The skills, knowledge, and dispositions that an individual acquires through their upbringing and education, which can be used to navigate social institutions and gain advantages.

Symbolic Capital: The prestige, honor, and recognition that an individual or group can command, which can be converted into other forms of capital.