The main factors of production. Production and factors of production. Production function Main factors of production and types of income

The main reasons for production activities and the conditions in which the creation of an economic product occurs are called factors of production. They are, in a sense, the driving forces of production, part of production capacity.

In the simplest case, the factors of production are understood as the triad "labor, land, capital", which embodies the labor and natural resources involved in creating a product. Recently, entrepreneurship has been named as one of the significant factors. However, this list will not be exhaustive either.

In Marxism, the conditions of production include labor, the object and means of labor, considering personal and material factors. The whole set of a person's abilities to work is personal. As material, Marxist methodology classifies the means of production, brought together in a complex system, in which a special place is given to the organization of production and technology. The latter is understood as the interaction between all factors of production.

The main factors of production in marginalist theory are:

Natural resources;
work;
capital;
entrepreneurship;
scientific and technical factor.

Natural factor

The natural factor embodies the natural conditions in which production processes take place. Substance, minerals, earth, water, air, plant and animal world... As a factor of production, the natural environment allows the use of natural resources, which serve as raw materials, in the manufacture of a product. All the variety of material products are made on the basis of such raw materials.

The energy basis of production is the Earth and the Sun. At the same time, the planet becomes a production site, where the means of production are placed, where workers work.

Land has become one of the most unique resources nowadays, because its supply is limited. This type of material production conditions is an area where there are natural resources and minerals. The usefulness of a land resource is assessed by its ability to be suitable for agricultural work and for biological reproduction.

The natural factor acts as a passive component in the triad. However, in the course of transformations, objects of nature pass into the main means of production and gradually acquire an active role. In some factorial economic models, the natural factor is taken into account in an implicit form, which by no means diminishes the degree of its influence on production processes.

Labor factor

Labor is presented in a number of factors of production as an element that is designed to initiate the production process. This category is represented by the labor of workers who are directly involved in the creation of goods. At the same time, the concept of "labor" embodies a varied number of types of activity that directs production and accompanies it at all stages. Labor consists in the direct participation of a person in the transformation of resources (energy, matter, information). People contribute to the production process with physical and mental effort. All its participants bring their labor into the production process, each form of labor ultimately affects the result.

In macroeconomic models that use the resource approach, when considering the main factors of production, it is often not labor as such that is singled out, but labor resources, that is, the working-age population or the total number of those who are employed in production activities. It is important to understand that labor factor manifests itself, among other things, in the quality of labor, in its efficiency, in labor efficiency.

Labor is the most important economic category, since its costs determine the effectiveness of an established organization of production. Through labor activity, a person actively influences the subject of labor. The intensity of the labor process affects the labor intensity and the amount of time spent on the manufacture of the product. This data makes it possible to identify the problems faced by the production.

The labor force determines other economic categories - the unemployment rate and employment. The structure of the labor force includes all people who, in one way or another, take part in production in accordance with their labor skills. Human activity has a peculiarity: the labor force is formed over the years, it requires continuous renewal. For a successful career, an employee must maintain useful skills and always be in the right physical shape.

Capital as a factor of production

Capital is understood as means of production that are involved and directly involved in the manufacture of an economic product. Capital can appear in production activities in a wide variety of forms; there may be different ways of accounting for it. If human labor creates only a condition for production, then capital becomes the goal, purpose and mode of existence of production activity. Therefore, the importance of capital is often placed above labor.

This factor is expressed in both physical and money capital. Physical capital is the main means of production. Working capital are also becoming the most important material resource and a source of activity for the production of an economic product. In the long term, the factor also includes investment.

In short, capital refers to any type of property used to make a profit. For this very purpose, since the emergence of an industrial society, investments (capital investments) directed to production have been widely used in it. In its material and material form, the invested funds turn into fixed assets and become factors production process.

According to a number of economists, after labor, capital ranks second among other conditions of success. economic activity... Recently, more and more often they allocate human capital, including knowledge, skills, professional experience that the employee possesses. Other researchers do not consider it expedient to introduce such a category, since its content is largely covered by the labor factor.

Entrepreneurship as a factor of production

Entrepreneurial activity and initiative have a beneficial effect on the results of production activities. The difficulty lies in quantitatively establishing the effect of the influence of this factor. It is extremely difficult to measure this influence. Therefore, this factor is judged, as a rule, exclusively in terms of quality. The importance of entrepreneurial activity is that it increases and enhances the return to the labor factor.

Entrepreneurial ability is the ability to combine all factors of production in order to create a product with maximum efficiency. Being an entrepreneur means:

be able to make decisions;
take reasonable risks;
be able to organize workers to complete tasks.

Main factors of production and types of income

Each of the dominant production factors creates a certain type of income:

wages correspond to labor;
land - rent;
capital - interest;
business - profit.

Scientific and technical level of production

With the development of science, the scientific and technical level of production began to be included in the number of production factors. It expresses the degree of technological equipment of production, its technical perfection. The influence of this factor extends to the growth of labor productivity and the efficiency of capital use. Scientific and technical progress contribute to an increase in demand for products and an increase in sales.

This category is also often considered innovative activity... A technological innovation introduced into production very often becomes the factor that makes it possible to qualitatively improve the production process and makes it possible to bring fundamentally new products to the market.

In the conditions of the formation of a post-industrial society, information becomes an essential factor of production. It is one of the most important resources that affects economic processes... Information resources are used in any part of the system productive forces, becoming an integral part of living labor.

The functioning of enterprises and households is based on the use of production factors and the receipt of corresponding income from their use. Factors of production are understood as particularly important elements or objects that have a decisive impact on the possibility and effectiveness of economic activity.

In previous lectures, the laws of supply and demand were considered regardless of which product groups are included in the market turnover and competitive pricing. Meanwhile, the market turnover of factors of production has its own characteristics, although in general the same mechanism of competitive equilibrium of prices operates here. Behind the production resources involved in economic activities are always their owners (land, capital, labor, knowledge, etc.) and none of them will transfer the right to use this or that resource to other persons free of charge. Therefore, the movement of the basic elements of production, their appropriation, disposal and use affects deeper socio-economic relations. The last decades are characterized by an increase in resource costs and, as a result, a decrease in profitability from their use. Prices for land, energy resources, raw materials, and wages are growing. All this leads to a change in the behavior of people and firms in the world economy, encourages them to find substitutes for the more expensive resources and ways to reduce production costs. Only entrepreneurs are in demand for factors of production, i.e. that part of society that is able to organize and implement the production of products and services necessary for final consumption. Manufacturing is the process of making material or spiritual goods. In order to start production, it is necessary to have at least one who will produce and what will be produced from. Marxist theory singles out human labor power, the object of labor and the means of labor as factors of production, dividing them into two large groups: the personal factor of production and the material factor. The personal factor is a labor force, as a combination of a person's physical and spiritual abilities to work. The means of production act as a material factor. The organization of production presupposes the coordinated functioning of these factors. The Marxist theory proceeds from the fact that the interconnection of the factors of production, the nature of their combination, determine the social orientation of production, the class composition of society and the relationship between classes. Marginalist (neoclassical, Western) theory traditionally identifies four groups of factors of production: land, labor, capital, entrepreneurial activity. LAND is considered as a natural factor, as natural wealth and as the primary basis of economic activity. Here, from the material factor, natural conditions are allocated to a special fund. In this case, the term "land" is used in the broad sense of the word. It covers all the utilities that are given by nature in a certain amount and over the offer of which a person has no control, whether it be the earth itself, water resources or minerals. Unlike other factors of production, the EARTH has one important property - its limitation. A person is not able to change its size at will. In relation to this factor, we can talk about the law of diminishing returns. This refers to the return in quantitative terms or diminishing returns. Man can influence the fertility of the earth, but this influence is not unlimited. All other things being equal, the continuous application of labor and capital to the land, to the extraction of minerals will not be accompanied by a proportional increase in returns. LABOR is represented by the intellectual and physical activity of a person, a set of personality abilities, conditioned by general and professional education, skills, and accumulated experience. IN economic theory labor as a factor of production means any mental and physical efforts made by people in the process of economic activity in order to produce a useful result. "Any work - notes A. Marshall - has as its purpose to produce any result." The time during which a person works is called working time. Its duration is a variable quantity and has physical and spiritual boundaries. A person cannot work twenty-four hours a day. He needs time to restore his ability to work and satisfy his spiritual needs. Scientific and technological progress leads to changes in the length of the working day, in the content and nature of labor. Labor becomes more qualified, time for vocational training personnel, productivity and labor intensity increase. The intensity of labor is understood as its intensity, an increase in the expenditure of physical and mental energy per unit of time. Labor productivity shows how much is produced per unit of time. The increase in labor productivity is influenced by the most various factors... CAPITAL is another factor of production and is considered as a set of instruments of labor that are used in the production of goods and services. The term "capital" has many meanings. In some cases, capital is identified with the means of production (D. Ricardo), in others - with the accumulated material wealth, with money, with the accumulated social intelligence. A. Smith considered capital as accumulated labor, K. Marx - as self-increasing value, as a social relation. Capital can also be defined as investment resources used in the production of goods and services and their delivery to the consumer. Views on capital are diverse, but they all agree on one thing: capital is associated with the ability of certain values to generate income. Outside of movement, both the means of production and money are dead bodies. Entrepreneurial activity is considered as a specific factor of production that brings together all other factors and ensures their interaction through the knowledge, initiative, ingenuity and risk of an entrepreneur in organizing production. This is a special kind of human capital. Entrepreneurial activity in terms of its scale and results is equated to the cost of highly skilled labor. The entrepreneur is an integral attribute of the market economy. The concept of "entrepreneur" is often associated with the concept of "owner". According to Cantilla (18th century), an entrepreneur is a person with uncertain, unfixed income (peasant, artisan, merchant, etc.). He receives other people's goods at a known price, and he will sell at a price that is still unknown to him. A. Smith characterized the entrepreneur as an owner who goes to economic risk for the sake of implementing any commercial idea and making a profit. The entrepreneur acts as an intermediary, combining the factors of production at his discretion. The unification of the owner and the entrepreneur in one person began to collapse with the advent of credit and was most prominently revealed with the development joint stock companies... In a corporate economy, property as a legal factor loses its administrative functions. The role of property is becoming more and more passive. The owner only owns a piece of paper. The manager is responsible for the results of the activity. He is driven by the will to win, the desire to fight, the special creative nature of his work. Naturally, all of this applies to countries with an established market economy. During the transition period to the market, other laws apply. The difference in the classification of factors of production between Marxist and Western economic theory is due to the class approach to the analysis of natural production. This classification is flexible. The level and efficiency of production is increasingly influenced modern science, informational and economic factors. The ecological factor of production, which acts either as an impetus for economic growth, or as a limitation of its capabilities due to the harmfulness of technology, is acquiring increasing importance. In specific industries, its elements are used in various combinations and in various proportions. Such interchangeability and quantitative variability are typical for modern production and are associated with the limited resources on the one hand and the efficiency of their use on the other. In real life, an entrepreneur seeks to find such a combination of production components, which ensures the highest output at the lowest cost. The multiplicity of combinations is due to scientific and technological progress and the state of the market for factors of production. Production is flexible. Large and small revolutions in technology, technology, labor organization are constantly taking place in it. The company is constantly looking for the most rational decisions... What gives a greater effect is "investing in human factor, or in the growth of the means of production "(capital)? How will an increase in factor A and a decrease in factor B affect the costs and income of the company? In this case, it is necessary to take into account constant changes in prices for production resources.

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Introduction

The production process is always the result of the interaction of certain factors, which in economic science are called factors of production or production resources.

The effectiveness of the use of factors of production can be reflected by the category of production efficiency (the ratio of the result of the productive use of factors of production and other costs. The efficiency of production can be increased by both increasing the factors used and their fuller use, i.e., extensively or intensively. In the real production process, both paths are intertwined with the overloaded role of one of them. With the development of society, the intensive path becomes more and more widespread. The process of intensification of production means a more complete use of its factors, their qualitative improvement, as well as the improvement of technologies for using productive forces.

To satisfy needs, it is necessary to be able to satisfy them, in other words, resources, factors of production are needed.

Economic theory studies the general patterns of behavior of people and the economic system as a whole in the process of production, exchange, distribution and consumption of goods in conditions of limited resources.

Needs are a need or lack of something necessary to support the life and development of an organism, a human personality, a group of people, society as a whole.

It is their needs that force people to produce the products necessary for their life, to exchange with other people what they have in excess, for what they lack. From the moment when people begin to prepare to meet their needs, relying on the available limited resources, economic activity begins.

It is important to note that needs change with the development of human society, some needs disappear, others appear. Moreover, their total amount grows very quickly. Needs are growing much faster than the possibilities of meeting them. We can say that the needs are unlimited. If we take the long-term perspective of the development of society as a whole, then in this perspective the needs are unlimited. Although, of course, a person's need for a particular product at a given time period can be satisfied, and at this moment it is limited. For example, the need for food at a given time is limited.

Factors of production in the economy

Factors of production - resources used in production, on which the quantity and volume of output depend to a decisive extent. The demand for factors of production is derivative: it exists only insofar as they participate in the production process.

For the production of any good, resources are needed, which act as factors of production. The following factors of production in economic science are distinguished - land, labor, capital, as well as entrepreneurial ability.

Natural resources.

Land - in the economy - one of the four main factors of production, which in order to become productive, usually must be combined with labor and capital.

Earth - "free blessings of nature"; natural resources that can be used for the production of goods and services: for the production of agricultural products, the construction of houses, cities, roads.

Land as a factor of production is considered in two senses.

In the first, narrow sense, under the ground is understood directly land... In this case, priority is given to the location of the site, its area and the quality of the land.

In the broad sense of this word, land means all natural resources used in the production process, located in the bowels of the earth and on its surface. So, in the mining industry or in the sea and river space, in the construction of hydroelectric power plants or storage facilities of various material values, land is valuable not so much by its area as such, but by the resources that are associated with it.

The earth is an invaluable gift of nature, not only because it contains all the resources that all mankind uses, but it is also the sphere of habitation of all living things, including man himself. Natural foundation natural resources are planetary natural conditions. These include the geographical position and topography of the area, the structure of the bowels, climate, planetary warmth and solar radiation, water and sea areas. All these and other natural resources and conditions create the possibility of the corresponding activities of people as they develop these natural conditions.

The natural resources themselves are a set of natural conditions that can be used in the process of creating material and spiritual benefits.

Labor - in the economy - is one of the four main factors of production.

Labor - labor activity a person, considered from a socio-economic point of view, regardless of its specific results, as the expenditure of labor or the ability to work.

The labor process includes three main factors:

Expedient human activity;

The subject to which the work is directed;

The means of labor, with the help of which a person influences the subject of labor.

Labor is a form of realization of human labor power as a combination of physical and spiritual properties that allow him to participate in the production process. Man sets in motion the means of production, he animates them; without him they are dead. Therefore, neither the use of natural resources nor the production of new goods is possible without labor.

The resource of labor is limited at least by the factor that the population is not infinite. In addition, each time there is a need not for labor in general, but for labor services of a certain type and quality, which are even more limited.

Another part of the means of production is created by human labor. These are the so-called man-made means of production. Most often they are defined as physical capital, or just capital.

Capital - in a broad sense - is anything that can generate income, or resources created by people to produce goods and services. In a narrower sense, it is an invested, working source of income in the form of means of production (physical capital). It is customary to distinguish between the main capital, which represents a part of capital assets that participates in production over many cycles, and circulating capital, which participates and is completely consumed during one cycle. Monetary capital is understood as money with which physical capital is acquired. The term "capital", in the meaning of " capital investment material and Money in the economy, in production "is also called capital investment, or investment.

Capital is all that is used labor force in the production of products and services, in particular, these are machines, equipment, tools, buildings, vehicles, warehouses, pipelines, power lines, water supply and sewerage systems. Capital is the means of labor that are created by man. In the production process, man-made means of labor are used to transform objects of labor, that is, raw materials, minerals. The means of labor in physical form are called real capital. Real capital is an economic resource, a factor of production. The process of producing and accumulating these means of production is called investment.

It is important to note two more points here:

firstly, investment goods (means of production) differ from consumer goods in that the latter satisfy needs directly, while the former do it indirectly, ensuring the production of consumer goods;

second, in the definition given here, the term "capital" does not mean money. True, managers and economists often talk about "money capital", meaning money that can be used to purchase machinery, equipment and other means of production. However, money, as such, does not produce anything, and therefore it cannot be considered an economic resource (factor). Real capital - tools, machines, and other productive equipment - is an economic factor; money, or financial capital are not such a factor.

The production process can be defined as the process of combining the factors of production. Such a connection can take place directly in an individual form and to meet personal needs (production of vegetables in the country for personal consumption), in a collective and to meet general needs (joint construction of a dam to protect their village from flooding), as well as in the form of entrepreneurship.

Entrepreneurial ability is a set of qualities, skills, abilities of a person, allowing him to find and use the best combination of resources for the production, sale of goods, make reasonable consistent decisions, create and apply innovations, take an acceptable, justified risk.

Entrepreneurial production in modern conditions has become its main form. One of the functions that an entrepreneur performs is the search and mobilization of the resources available in society. It is the entrepreneur who today studies the needs and finally determines what, how much and how to produce. Therefore, we have the right to talk about participation in modern production of the fourth type of resources - entrepreneurial abilities. And although they are also carried by a person, entrepreneurial abilities cannot be equated with labor services. Not all of us have the gift of an entrepreneur. Let us remember, for example, that in Maslow's pyramid, the need for stability, the fight against risk, come in importance immediately after physiological needs. And this idea of values an ordinary person... And an inherent feature of entrepreneurship is risk, moreover, it is not insured. Therefore, entrepreneurial abilities as a resource are limited, they have a common feature for all economic resources - a rarity.

Summing up the analysis of factors, we note that production is possible only when all factors are introduced into the production process. The production of a certain thing or service requires a certain set of factors, but the main ones are land, labor and capital. They act interconnected and complement each other.

All economic resources or factors of production have one common specific property: they are rare or available in limited quantities. Planet Earth contains only a limited amount of resources that can be used in the production of goods and services. Arable land, minerals, capital equipment and labor - their availability is limited to a certain limit. Due to the scarcity of production resources and the limit that their scarcity puts before production activities, the volume of production itself is limited by necessity. Society is unable to produce and consume the entire volume of goods and services that it would like to receive.

Thus, since our resources are scarce and our needs are practically limitless, we are unable to meet all the needs of our society. The only thing that remains to be done is to achieve the greatest possible satisfaction of these needs, i.e. seek maximum economic efficiency from the use of rare resources.

Cost-effectiveness covers the issue of input-output. Specifically, it characterizes the relationship between the number of units of rare resources and the resulting amount of any required product. More product from a given cost means more efficiency, less product from given quantity cost indicates decreased efficiency.

Society strives to use its scarce resources efficiently, i.e. it wants to get the maximum amount of useful goods and services produced from its limited resources. To do this, it must provide both full employment and full production.

Full employment refers to the use of all available resources. Workers should not be forced to give up without work; the economy must provide employment for all who are willing and able to work. Arable land or capital equipment should also not be idle. But it must be emphasized that only suitable resources should be used. Every society has well-known customs and well-established practices that determine which resources are suitable for use. For example, legislation and custom stipulates that the labor of children and the elderly should not be used. Likewise, arable land, in order to ensure their fertility, must be periodically left fallow.

The full volume of production means that resources must be allocated efficiently, i.e. that the resources employed should be used in such a way that they make the most valuable contribution to total production.

In addition, the multiplicity of economic goals with limited resources also poses the problem of economic choice - the choice of the best of the alternative options at which maximum efficiency is achieved, i.e. maximum satisfaction of needs at the given costs.

Thus, due to the limited economic resources, each person, company and society as a whole faces the problem of what, how and for whom to produce, i.e. how to determine the conditions and directions for the use of limited resources. At the same time, economic science not only tries to fix what is, but also develops best options solutions to the problems that have arisen. In the latter case, the problem of rational economic management arises. It is usually assumed that the economic entity is "homo econimic" - a reasonable (rational) individual, well trained, having deep general and professional knowledge, as well as extensive practical experience. Its goal is to achieve maximum results at a given cost of resources or to minimize costs while achieving the intended goal. Such a premise is rather unrealistic, since the existing statistics are too inaccurate, the methods of analysis are rather crude, and information on the real activities of economic entities is very limited. Nevertheless, optimization theory serves as a kind of guide to rational activity. In economic theory, it is assumed that every business entity strives for maximization; the consumer - to meet their needs, the firm - the profit, the trade union - the income of its members, the state - the level of the people's well-being or, according to the theory of public choice, the prestige of politicians.

The production capabilities of society are the maximum possible volume of production of goods with the full and efficient use of available resources. The growing needs of society are oriented towards a constant increase in the result. But, since resources are limited, production capabilities are also limited. An increase in the volume of production of one product can be achieved only with a partial or complete rejection of the production of another. The scarcity of resources determines their alternative use. Since resources are scarce, an economy of full employment, full volume of production cannot provide an unlimited output of goods and services. Moreover, decisions should be made as to which goods and services should be produced and which should be discarded.

Production factors and possibilities:

Production includes three heterogeneous factors (Latin factor - making, producing). Let's consider them in a natural-material form, which is characteristic of any society.

The first factor is human. For production, people are always needed who have necessary knowledge and labor skills.

Labor in material production is a purposeful activity in which people, with the help of the means they have created, change objects of nature, adapting them to meet their needs.

The second factor is material - the means of labor. These include those material things with the help of which people create useful goods. The composition of the means of labor includes the natural conditions of the production process (for example, water used, say, in hydroelectric power plants or in reclamation structures for economic purposes) and technology - artificial, man-made means of labor. In turn, they include tools of labor (tools, machines, equipment, apparatus chemical production etc.), thanks to which the original natural substance is converted into useful goods, as well as general material conditions of labor (industrial buildings, canals, roads, etc.) The third factor is also material - the object of labor. This is a thing or a set of things that a person adapts to his needs. The objects of labor are also subdivided into the substance of nature, which has not been processed (for example, coal seam in a mine, ore in a mine), and raw materials (raw materials), which have undergone the influence of human labor (coal and ore taken out of the seam, sent for further processing ).

All three factors are linked together through technology. Internal structure production can be visualized in Fig. 1. All of these factors (or production resources) at any given time are limited in relation to needs. This limitation can be: absolute (resources cannot be increased at all) and relative (factors can be multiplied, but to a lesser extent in comparison with the growth of needs).

Fig. 1. Production factors

Let's say that machine-building plants produce products: a) for civilian needs ( cars, refrigerators, vacuum cleaners, etc.) and b) for the army (tanks, missiles, etc.). Government and owners machine-building enterprises given the changed demand, we must decide how to make fuller use of production resources. According to the option, designed in case of war, all factors of production will be used to manufacture weapons in the amount of 170 thousand pieces. Another option (under peaceful conditions) provides for the production of civilian products - 300 thousand items. The possible choice of other options is clearly reflected by the scale production capabilities(Table 1). It shows how many different goods can be created with the full use of resources.

Table 1

The data in Table 1 allow us to construct a graph of production possibilities - a curve that outlines the border of the full use of economic resources (Fig. 2).

Rice. 2

Looking at the graph, you can imagine many options for choosing between the release of subsistence and military products. Suppose a decision is made to carry out a significant conversion of defense enterprises (switch their work to the production of civilian products) and increase the production of goods for the population from 140 to 220 thousand units. However, in the absence of reserves, this can be done only by reducing the production of weapons from 120 to 80 thousand units, that is, by 40 thousand items.

The last digit accurately identifies economic consequences, a kind of "price" of the decision made - "opportunity cost". Opportunity value refers to the amount of goods that must be given away (or, as they say, sacrificed) in exchange for products that are much more preferred. In the case under consideration, an increase in the welfare of the population (an increase in the output of consumer goods from 140 to 220 thousand items) has an alternative cost equal to 40 thousand items of military equipment. Of course, in real life it is necessary to determine the production possibilities in relation to many goods. Now in economically developed countries, millions of types of products are taken into account. Ways to solve emerging complex tasks will be discussed later.

It is important to note that the choice of suitable production opportunities is carried out ambiguously in different periods of economic development.