![]() It took the brain-power of entrepreneurs to look at the resources they had in their cities. This allowed for industry to continue to increase, causing a snowball effect to occur with resources and industry.įinally, enterprise glued the other three factors together to launch a huge surge in industry, to the point of labeling it a revolution. As industry increased, the resources increased. ![]() Capital refers to the resources available. Again, the urban environment allowed for access to many laborers and because there were so many workers readily available, factory owners could pay small wages. What are the four factors of production required for industrialization – Second is labor. Entrepreneurship as a Factor of Production. ![]() What are the 5 primary factors of production? What are the 3 production factors?Īn entrepreneur is a person who combines the other factors of production – land, labor, and capital – to earn a profit. Economists divide the factors of production into four categories: land, labor, capital, and entrepreneurship. The factors of production are resources that are the building blocks of the economy they are what people use to produce goods and services. What are the 4 production factors?įull Transcript. Any increase in production leads to economic growth as measured by GDP. The Importance of the Factors of Production If businesses can improve the efficiency of the factors of production, it stands to reason that they can increase production and create higher quality goods at lower prices. Why are these factors of production so important to an industrial revolution? The second factor of production is labor. The income that resource owners earn in return for land resources is called rent. These resources can be renewable, such as forests, or nonrenewable such as oil or natural gas. Land resources are the raw materials in the production process. , what are the four factors of production required for industrialization Rather people found that industry was most efficient in cities where factories and living spaces were close and more revenue could be generated on less space. Land was used in an interesting way in the Industrial Revolution because it did not generally refer to land masses for farming. Let us first examine the impact of land on the Industrial Revolution. In other words, each of the factors refers to a specific requirement for production to occur, and the Industrial Revolution would not have been able to happen without the factors of land, labor, capital, and enterprise. The four factors of production were important to the Industrial Revolution because they are the fundamentals of industry. If you’re behind a web filter, please make sure that the domains *.kastatic. What are the four factors of production required for industrialization – If you’re seeing this message, it means we’re having trouble loading external resources on our website.
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