Land as a Factor of Production

Land as a Factor of Production: Meaning and Definition: The term land in economics is used in a special sense. It does not mean soil or earth surface alone. Land in economics means natural resources. It includes all those things which are found under and over the surface of earth. In the words of Marshall: "The land means the material and the forces which nature gives freely to man's aid in land and water, in air and light and heat". Characteristics/Features: The main characteristics/Features of land as a factor of production are as follows: (i) Supply of land. The supply of land from the point of view of the economy is perfectly inelastic. However, from the point of view of a firm, it is relatively elastic. (ii) No geographical mobility. Land has no geographical mobility. It cannot be shifted from one region to another region. (iii) Land differs in fertility. All the plots of land are not homogeneous. They differ in fertility. (iv) Land is permanent. The power of the soil is original and indestructible.

Labor as a Factor of Production: Meaning and Definition: "Labor is an important factor of production. It is described as any human work which is performed with the help of mind or physique with a view to earn income". Characteristics/Features: (i) Labor as a source. Labor is the source of his own labor power, It is inseparable from labor himself. (ii) Labor is perishable. A worker cannot store his labor. It is perishable. (iii) Difference is labor power. The labor power differs from worker to