Conceptual realism has muddled the comprehension of the concept of capital. It has brought about a mythology of capital. Capital, it is said, reproduces itself and thus provides for its own maintenance. Capital, says the Marxian, hatches out profit. All this is nonsense.
Capital is a praxeological concept.
It is a product of reasoning, and its place is in the human mind. It is a mode of looking at the problems of acting, a method of appraising them from the point of view of a definite plan. It determines the course of human action and is, in this sense only, a real factor. It is inescapably linked with capitalism, the market economy. The capital concept is operative as far as men in their actions let themselves be guided by capital accounting.