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FACTORS OF PRODUCTION
Meaning: Factors of production refers to agents, components and resources which are combined together to make production possible. These are:
- Land
- Labour
- Capital
- Entrepreneur
LAND: Land is a free gift of nature. It includes all natural resources used in production liked ocean, forests, mineral resources, rivers, oceans, atmosphere etc. The reward for land is rent.
CHARACTERISTICS/FEATURES OF LAND
- Land is immobile
- Land is a free gift of labour
- It is relatively indestructible
- The supply of land is fixed.
- The quality and value of land varies from one place to another
IMPORTANCE OF LAND.
Land is needed for the following purposes
- Farming purposes
- Livestock purposes
- Fishery purposes
- Wild life purposes
- As collateral security
- Residential building
- Sources of minerals
- Construction purposes etc.
LABOUR: Labour is defined as all human efforts put into production. It involves man’s mental and physical exertion in the process of production. The reward for labour is wages and salaries.
Types of Labour: There are three types of labour, namely:
- Unskilled Labour: this comprises of labourers with little or no education, whose work requires the use of physical energy.
- Semi – skilled labour: this comprises of workers with little education or training, whose job does not require high skill or high mental effort.
- Skilled Labour: this comprises of workers who possess high level education and skill such professionals and managerial staff.
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