14/03/2012

Irfan Shafiq

The resources used in production :

Labour

Land Capital
Entrepreneurship
14/03/2012 Irfan Shafiq

What is Labour?
Labour is human effort used in production. -- physical effort -- mental effort

What is labour force?

A group of people in the population who are either in employment or who are available for employment
14/03/2012 Irfan Shafiq

Productivity of labour:
Labour productivity = -----------------------------Total men working hours Total output

= ? Units per working hours

Supply of labour:
Total number of units of labour available for employment at a given time.It is usually measure as men-hours.
14/03/2012 Irfan Shafiq

--A large population usually provides more labour for production.

--We regard people who are aged between 15 and 65 as the working population.An economy with a large working population tends to have a large labour supply.
14/03/2012 Irfan Shafiq

--The number of hours the workers are willing to work is more. The labour supply will be increased.

--Higher wage rate will attract more people to work or work more.The labour supply will be increased.

14/03/2012

Irfan Shafiq

-- Better management (e.g. division of labour) can increase the efficiency of productor. It can increase the labour productivity.

-- Education and training can improve the skill of the workers.So their labour productivity will increase.
14/03/2012 Irfan Shafiq

-- The use of better machines will greatly increase the labour productivity.

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Irfan Shafiq

-- Occupational mobility refers to the ease with which a factor can transfer from one industry to another industry.

e.g.
14/03/2012 Irfan Shafiq

-- e.g. A professional worker (e.g. professor) usually has high income.The cost for him to change the job is giving up the income earned by his existing job.His cost of changing job is high. He seldom changes his job.Therefore his occupational mobility is low.
14/03/2012 Irfan Shafiq

-- The restrictions of trade union will limit the mobility of labour from one industry to another industry.

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Irfan Shafiq

-- Geographical mobility refers to the ease with which a factor can transfer from one place to another place.

e.g.
14/03/2012 Irfan Shafiq

-- If the regulations are very strict , the geographical mobility will be lower. --If the transportation becomes more convenient, the time for traveling is shorter or the transportation expense is lower, the cost of moving will be lower.The geographical mobility will be higher.
14/03/2012 Irfan Shafiq

--If a country has a good government and a good political system,the people are willing to work in a country.The geographical mobility will be reduced. --If a country can provide a good economic environment (e.g.better living standard),people are more willing to stay in the country for work. This will reduce the geographical mobility.
14/03/2012 Irfan Shafiq

What is land?
Land is all the natural resources used in production.

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Irfan Shafiq

--Land is a gift of nature. --Land is limited in supply. --Land is immovable.

14/03/2012

Irfan Shafiq

-- Land is totally geographically immobile.

--Land is quite occupationally mobile because the land uses can be changed.

14/03/2012

Irfan Shafiq

What is capital?
Capital is man-made resources used for future production of good and services.
14/03/2012 Irfan Shafiq

Capital can increase labour productivity.

Capital can increase the production capacity. Capital is used for future production of good and service.This can increase the living standard of the people in the country in the future.
14/03/2012 Irfan Shafiq

Functions of an entreneurship

He makes decisions about the production.

14/03/2012 Irfan Shafiq

14/03/2012

Irfan Shafiq