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What is Factors of Production
Factors of production are used in a production of economic goods as inputs. Economic theory usually defines three types of factors of production: Land, Labor, Capital Stock.

Factors of production are used in a production of economic goods as inputs. Economic theory usually defines three types of factors of production:

  • Land (natural resource) – part of nature, it is used in agriculture, natural resources are used for production of materials and energy
  • Labor (human effort) - purposeful human activity for production and transforming inputs into outputs
  • Capital Stock (means of production, finance/financial capital) – it is a result of previous production (capital goods)

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Last update: 02.12.2015

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