Capital formation improves the conditions and methods for the production of a country. Hence, there is much increase in national income and per capital income. This leads to increase in quantity of production which leads to again rise in national income. The World Bank tracks gross capital formation, which it defines as outlays on additions to fixed assets, plus the net change in inventories. Fixed assets include plant, machinery, equipment, and buildings, all used to create goods and services. Inventory includes raw materials and goods available for sale.Oct
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<span>Civilizations wanted to settle and build cities and/or outposts along trading routes for so it would be easy to acquire what they didn't have, and sell what they did, and gain economic prosperity. These became the most desirable and wealthy spots, and thus were fought over in wars.</span>
They stressed the direction of all human activity toward the goal of increasing the power of the ruler and the state.
