Production factors

The following production factors are traditionally distinguished:

• Earth;
• Work;
• Capital.

Also currently added to them:

• Entrepreneurial ability;
• Information.

Earth

Earth is natural resources necessary for the existence of human society and used in the economy.

Labor

Labor is a purposeful, conscious human activity aimed at meeting the needs of the individual and society. In the process of this activity, with the help of tools, a person masters, changes and adjusts objects of nature to his goals, uses the mechanical, physical and chemical properties of objects and natural phenomena and makes them mutually influence each other to achieve a predetermined goal. In the process of purposeful work, a person (a subject of labor) with the help of the tools created by him transforms the subject of labor into the product he needs. The product of labor is determined by the specifics of the subject (material), the level of development of tools, the purpose and method of its implementation.

Capital

Capital (financial resources) - the aggregate of property used to make a profit. The direction of assets in the sphere of production or the provision of services for profit is also called investment or investment. The independent term capital is not used in modern accounting, but there are a number of close indicators of financial analysis. For example, equity is the difference between the value of a company's assets and the amount of its liabilities. Usually this value is formed at the expense of the authorized capital (contribution of the company owners), additional capital (revaluation of property, share premium), retained earnings and reserves (formed from profit).

Entrepreneurial abilities

Entrepreneurial abilities are a factor linking together the rest of the production resources, an economic resource, which should include entrepreneurs, entrepreneurial infrastructure, as well as entrepreneurial ethics and culture. In turn, entrepreneurs are primarily business owners, managers who are not their owners, as well as business organizers, combining owners and managers in one person. The term “entrepreneurial potential” is also used. In general, entrepreneurial potential can be described as potential opportunities for the implementation of entrepreneurial abilities of people. The uniqueness of the importance of entrepreneurship lies in the fact that it is thanks to it that other economic resources come into interaction - labor, capital, land, knowledge. The initiative and skill of entrepreneurs, coupled with the market mechanism, allows maximum efficiency to use all other economic resources, to stimulate economic growth.

Information

Information is a resource used in economic processes. Information, embodied in all components of the system of productive forces of society, acts as an integral element of all aspects of the labor process - and the subject of labor, and a means of labor, and an integral part of living labor. The multifunctionality of information and the possibility of its rapid transformation from one moment of the labor process to another provide this productive force with one of the leading roles in the development of the system of productive forces of modern society. Throughout the history of mankind, people in the process of transforming the world around them also transform the information embodied in it. Changing the riverbeds, a person transforms their physical and geographical parameters. By building houses, he modifies the information contained in the relief of the earth's surface. By introducing new varieties of plants and animal breeds, a person transforms the information contained in their genotype. Possession of reliable information is a prerequisite for solving the problems facing the economic entity. However, even complete information is not a guarantee of success. The ability to use the information obtained to make the best decision under the circumstances characterizes such a resource as knowledge. The bearers of this resource are qualified personnel in the field of management, sales and customer service, technical maintenance of goods. This resource gives the greatest return in business.

In a market economy, economic resources are freely bought, sold and bring their owners a special (factor) income:

• Earth is rent ;
• Labor is wages ;
• Capital - interest ;
• Entrepreneurial ability - profit ;
• Information - Royalty .

German economist and philosopher of the XIX century. Karl Marx singled out personal and material factors of production, while man himself acts as a personal factor as a carrier of labor, and the material factor of production means the means of production, which in turn consist of means of labor and objects of labor.

A means of labor is "... a thing or a complex of things that a person places between himself and the subject of labor and which serve for him as a conductor of his effects on this subject." Means of labor, and primarily tools, include machines, machines, tools with which a person acts on nature, as well as industrial buildings, land, canals, roads, etc. The use and creation of means of labor is a characteristic feature of human labor . The means of labor in a broader sense include all the material conditions of labor, without which it cannot be performed. The universal working condition is land, the working conditions are also industrial buildings, roads, etc. The results of public knowledge of nature are embodied in the means of labor and the processes of their production application, in engineering and technology. The level of development of technology (and technology) is the main indicator of the degree of society’s mastery of the forces of nature. “Technology reveals the active attitude of man towards nature, the direct process of the production of his life”

Objects of labor - a substance of nature, on which a person acts in the process of labor in order to adapt it for personal or industrial consumption. The subject of labor, which has already undergone the impact of human labor, but intended for further processing, is called Raw Material. Some finished products may also enter the production process as a subject of labor (for example, grapes in the wine industry, animal oil in the confectionery industry). “If we consider the whole process from the point of view of its result - a product, then both the means of labor and the subject of labor both act as means of production, and labor itself - as productive labor”

According to K. Marx, the totality of production factors acts as productive forces, which are inextricably linked with production relations. Some characterize the material-material content of the process of social production, while others characterize its historically determined form. Evolving, each stage of development of productive forces characterized by the type of production relations constitutes a unique mode of production.

Non-Marxist economic theorists do not agree with the position of K. Marx that new value is created only by wage workers, but they believe that all factors of production take equal part in its creation. So, Alfred Marshall wrote: “ capital in general and labor in general interact in the production of the national dividend and receive their income from it accordingly to the extent of their (marginal) productivity. Their mutual dependence is the closest; capital is easily dead; the worker will not live long without the help of his own or any other capital. When labor is energetic, capital reaps rich rewards and grows rapidly; thanks to capital and knowledge, the ordinary worker of the Western world feeds, dresses, and even provides housing in many ways better than princes in earlier times. The collaboration between capital and labor is just as necessary as the collaboration between the spinner and the weaver; a small priority on the side of the spinner, but this does not give him any advantage. The prosperity of each of them is closely connected with the strength and energy of the other, although each of them can benefit temporarily, or even constantly, at the expense of the other, a slightly larger share of the national dividend. ” ^[1]

In addition to the main factors of production in various sources, the following factors of production are distinguished:

Innovation ( English innovation ) is an implemented innovation that ensures a qualitative increase in the efficiency of processes or products that is in demand by the market. It is the end result of the intellectual activity of man, his imagination, the creative process, discoveries, inventions and rationalization. An example of innovation is the introduction of products (goods and services) to the market with new consumer properties or a qualitative increase in the efficiency of production systems. By the time of the emergence of science, by the will of the social division of labor, the group of workers is separated in the framework of joint (universal) labor, the main function of which becomes the so-called speculative activity or comprehension of the external nature. Science since the emergence of the capitalist mode of production and the comprehensive development of the market mechanism has become a significant factor in this mode of production. Moreover, there can be no talk of any separation of it from direct production. Science in these conditions is separated only from a single worker involved in the production process. It follows from this that all the talk about the processes of the so-called introduction of science and its results into production or its accelerated connection with production, the integration of science with production, in fact, have no real basis. In this case, it will be more accurate to talk about the use of knowledge in production, which has acquired social significance and usefulness adequate to this.

• Means of production
• Production function

• Blaug M. Demand for factors of production // Economic Thought in Retrospect = Economic Theory in Retrospect. - M .: Case , 1994 .-- S. 395-408. - XVII, 627 p. - ISBN 5-86461-151-4 .
• Drucker P. Effective Management. Economic challenges and optimal solutions. M .: FAIR-Press, 1988
• Stankovskaya I.K., Strelets I.A. Economic theory for business schools: a textbook. - M .: Eksmo, 2005.
• Sychev N.V. Political Economy. Lecture course. - M .: IKF Ekmos, 2002.384 s.