Target

Investment

Investment, process of exchanging income during one period of time for an asset that is expected to produce earnings in future periods. Thus, consumption in the current period is foregone in order to obtain a greater return in the future.

From the standpoint of an individual

Two types of investment may be distinguished: investment in the means of production and purely financial investment. Although at the individual level both types may provide a monetary return to the investor, from the standpoint of the entire economy, purely financial investments appear only as title transfers and do not constitute an addition to productive capacity.