The material balance equation in a dynamic input-output model incorporating capital hinges very much on its assumption one makes with respect to the kind of capital. In this paper, we mention two different kinds of capital and analyse the consequences for the specification of the material balance equation of an established dynamic input-output model

Houba, Harold and Johannes Kremers (1991), Correction of the material balance equation in dynamic input-output models, European Economic Review 35, 1103--1108.