The Factors of Production and Their Mobility.
Types of Factors of Production
- Land – All the natural resources, such as Sunlight
- Labour – All human resources, such as a person working
- Capital – All capital resources such as machinery
- Enterprise – Provided by an entrepreneur, he assembles land, labou,r and capital to start up any business.
Importance of The Factors of Production
- Land – It is the source of all material life.
- Labour – Most goods and services are better treated by labour as an individual in their job can use emotions and mental power to satisfy wants.
- Capital – performs more complex tasks quicker than humans.
- Enterprise – Provide goods and services to satisfy wants.
The Mobility of the Factors of Production
There are two types of mobility, namely, geographical mobility and occupational mobility
Geographical Mobility refers to the ability of a factor to move from one place to another, whereas Occupational Mobility refers to the ability of a factor to change use.
- Land, for instance, as a plot of land cannot move from one place to another, yet fertile soil can be transferred from one place to another. Thus, land in this form is geographically immobile. On the other hand, a plot of land can be used for different purposes, such as Farming or Housing. Thus, land in this form is Occupationally Mobile.
- Labour, for instance, the reallocation of a worker from one area to another, will depend upon factors like families or different costs of living. On the other hand, it will depend upon the type of qualifications or experiences of the individual.
- Capital, for instance, It will depend on the type of capital goods because a motor vehicle can easily move from one area to another whereas an airport or seaport cannot be transferred easily.
- Enterprise, for instance,