Labour is an active factor of production: Production from land and capital starts only when a man makes efforts. Production begins with the active participation of man. Therefore, Labour is an active factor of production.
Is Labour a man made factor of production?
Labor. All human effort that assists in production is labour. This effort can be mental or physical. It is a human factor of production.
How Labour is a living factor of production?
Answer: As discussed above, labour is the living factor of production. It is the only factor that can work and start the production of goods and services itself. Labour uses land and capital for production. However, neither land nor the capital can itself begin production of goods to produce the final product.
Why labour is an important factor of production?
Labour is an active factor of production. It is the factor that starts production. Land and Capital alone cannot start production, so they are passive factors. They need the active factor of production, i.e. labour to be productive themselves.
How is Labour classified as a factor of production?
Labour is classified into two types, namely productive and unproductive labour. By the term ‘ productive labour ‘ we mean the creation of economic utility through the production of a good or service.
What is the definition of labour in economics?
In Economics, the term ‘ Labour ‘ is used for indicating any work, whether manual or mental, which is undertaken for a monetary consideration. It may be noted that any work done for the sake of pleasure or love or obligation is not called labour in Economics. There are some special characteristics of labour as a factor of production.
Which is a feature of the factor of production?
It includes all types of human efforts – physical exertion, mental exercise, use of intellect, etc. done in exchange for an economic reward. Let us see the features of labour as a factor of production. Labour is perishable in nature. This simply means that it has to storage capacity, i.e. labour cannot be stored.
Why is capital considered as a separate factor of production?
Capital, which is considered as a separate factor of production is, in fact, the result of the reward for labour. Labour earns wealth by way of production. We know that capital is that portion of wealth which is used to earn income. Therefore, capital is formulated and accumulated by labour.
