For example, the labor of Kathmandu can travel to Tokyo or another place to give his services. It means labor can be moved from one place to another place. Labor alone is a factor that is mobile or moves. It means, labor perishes forever, it is not renewable. Unlike goods, energy, time, and effort of labor cannot be stored for future use. Generally, other factors of production like land and capital are the passive factor which is useless without the use of labor. Labor mobilizes other factors of production like land, capital in the process of production of goods and services. There are some attributes of labor and that can briefly explain as below The supply of labor depends on the wage rate, population growth, expenses on education, training, etc. Demand for labor largely depends on the marginal productivity of labor the wage rate. The demand for labor is a derived demand. Labor is an active factor of production which uses land and capital to make production possible. Work is done by porter, treatment service by a doctor, service of lawyers, engineer, etc. Labor is a physical or mental effort of a human being in the process of production to earn wages or income. Output or production is more in high fertile land than in less fertile land. It is fertile somewhere and sandy in other places. Only the value of land can be transferred.Īll land is not of the same quality. Human beings cannot move land from one place to another place like other factors. It becomes productive only when labor and capital are applied to it. In the process of production, land doesn’t take any active participation. The land is the passive factor of production. Human beings can destroy the quality of land but not the quantity of land fertility can be changed by human beings but the size of land remains constant. It means that we human beings it is not possible to put in even an inch to the existing supply of land. It neither can be increased nor decreased. The supply of land is always fixed in nature. Living things need not pay any rent for their natural state. That means, human beings neither create nor destroy the land. The land is gifted by nature in free for living things. There are some attributes of land and that can briefly explain as below It means, when economic value is created by man, another person should pay rent to use the land. Though the land is a gift of nature, it may not be freely available when it is used or owned by human beings. However, the land is passive or not active. Production is impossible in the absence of land. The land is a chief and essential factor input that is freely made available by the natural world. It means land refers to all things such as the surface of the land, mine, minerals, atmosphere, sea, forest, air, sunlight, etc. But in economics, land refers to all the gifts of nature that can be used in the process of production. Land in general notion refers to the surface of the earth. In economics, factors of production are generally grouped into four types i.e.
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