Capital Consumption Allowance

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The Capital Consumption Allowance (CCA) is the portion of the gross domestic product (GDP) which is due to depreciation. The Capital Consumption Allowance measures the amount of expenditure that a country needs to undertake in order to maintain, as opposed to grow, its productivity. The CCA can be thought of as representing the wear-and-tear on the country's physical capital, together with the investment needed to maintain the level of human capital (e.g. to educate the workers needed to replace retirees).

Video Capital Consumption Allowance

Calculation

Gross domestic product (GDP) equals net domestic product (NDP) + CCA (Capital Consumption Allowance).

${\displaystyle GDP=NDP+CCA}$

Maps Capital Consumption Allowance

See also

• Consumption of fixed capital

Source of article : Wikipedia