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(1) The conversion of surplus value into capital, that is, the utilization of surplus value for the expansion of capitalist production. The capitalized surplus value forms a fund of capital accumulation that, like capital, is divided in two parts: the additional constant capital, used for the acquisition of additional means of production, and the additional variable capital, used for buying additional labor power.

(2) The process of the formation of fictitious capital. In bourgeois society, each regularly recurrent income (such as ground rent or dividends) is capitalized: it is calculated at the average loan interest rate as if it were income from capital in the form of a loan at this interest rate. Each unearned income received by virtue of the ownership of securities is considered as interest from a certain capital, which in reality does not exist (imaginary capital). The securities issued (shares, bonds of corporations or the state) become capital and bear interest. The increase in the rates of the shares (capitalized dividends), particularly in the period of cyclic upsurge, leads to the accumulation of fictitious capital, which qualitatively and quantitatively differs from the accumulation of real capital and which is determined by its own laws. At the same time, the excessive expansion of fictitious capital and the subsequent stock exchange collapse may seriously affect the process of capital accumulation. Since the whole mass of fictional capital represents a capitalized income, the change of its value does not depend on the value movement of the actual (real) capital that it represents. Capitalization means the further development of the fetishist character of capitalist relations of production, that is, a further development of the treatment of money and things as if they had a kind of magic power over men.


Marx, K. Kapital, vol. 3. K. Marx and F. Engels, Soch, 2nd ed., vol. 25, chs. 1–2, sees. 5–7.
Novye iavleniia v nakopenii kapitala v imperialisticheskikh stranakh. Moscow, 1967.


References in periodicals archive ?
The final regulations require capitalization of (i) an amount paid to acquire any intangible; (ii) an amount paid to create certain but not all intangibles; (iii) an amount paid to create or enhance a "separate and distinct intangible asset"; and (iv) an amount paid to create or enhance a "future benefit," but only under certain circumstances.
According to NAREIT, the REIT industry is poised to continue its rapid growth through 1997, given the combination of strong, consistent total return performance, dramatic increases in market capitalization and liquidity as well as heightened interest from institutional and individual investors.
While the rules regarding capitalization of environmental treatment costs appear consistent with IRS and Financial Accounting Standard Board pronouncements, the TAM's treatment of remediation costs conflicts with the FASB's.
With respect to transactions in the first two categories that require capitalization, the ANPRM specifies which types of costs taxpayers will have to capitalize.
These regulations would require interest capitalization on improvements not classified as buildings and with class lives under 20 years, including items such as fences, paved parking areas, railroad tracks, bridges, tunnels, towers, greenhouses, grain storage bins and the like.
As for the other costs, the IRS concluded that capitalization might be required, depending on the facts of the case.
We believe that the diversity and training of our members enable us to bring an important, balanced, and practical perspective to the need for guidance on the deductibility or capitalization of expenditures in the aftermath of the INDOPCO decision.
The Eighth Circuit's Wells Fargo decision is important for all taxpayers involved in acquisitions, reorganizations or other capital transactions that provide future benefits, as well as those involved in other projects that may be subject to capitalization (such as enterprise resource planning implementation and Website design).
1039 (1992), in which the Supreme Court, not surprisingly, required the capitalization of the costs of a friendly merger that changed the corporate structure and promised long-term synergistic benefits to the taxpayer.