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What are the main factors of production?

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What are the main factors of production?
posted Jul 3, 2018 by Ritesh

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According to traditional economic theory, there are four main factors of production:
capital and

land and this includes not just land, but anything that comes from the land. Some common land or natural resources are water, oil, copper, natural gas, coal, and forests. Land resources are the raw materials in the production process. These resources can be renewable, such as forests, or nonrenewable such as oil or natural gas.

Labor is the effort that people contribute to the production of goods and services. If you have ever been paid for a job, you have contributed labor resources to the production of goods or services.

Think of capital as the machinery, tools and buildings humans use to produce goods and services.

An entrepreneur is a person who combines the other factors of production - land, labor, and capital - to earn a profit. The most successful entrepreneurs are innovators who find new ways produce goods and services or who develop new goods and services to bring to market. Without the entrepreneur combining land, labor, and capital in new ways, many of the innovations we see around us would not exist.

answer Jul 3, 2018 by Salil Agrawal