Front Page Titles (by Subject) Fixed and Circulating Capital. - The Theory of Political Economy
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Fixed and Circulating Capital. - William Stanley Jevons, The Theory of Political Economy 
The Theory of Political Economy (London: Macmillan, 1888) 3rd ed.
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Fixed and Circulating Capital.
Economists have long been accustomed to distinguish capital into the two kinds, fixed and circulating. Adam Smith called that circulating which passes from hand to hand, and yields a revenue by being parted with. The fact of being frequently exchanged is, however, an accidental circumstance which leads to no results of importance. Ricardo altered the use of the terms, applying the name circulating to that which is frequently destroyed and has to be reproduced. He says unequivocally:1 "In proportion as fixed capital is less durable, it approaches to the nature of circulating capital. It will be consumed, and its value reproduced in a shorter time, in order to preserve the capital of the manufacturer." Accepting this doctrine, and carrying it out to the full extent, we must say that no precise line can be drawn between the two kinds. The difference is one of amount and degree. The duration of capital may vary from a day to several hundred years; the most circulating is the least durable; the most fixed the most durable.
[]On the Principles of Political Economy and Taxation, chap. i., sec. 5, 3d ed., p. 36.