Mobility of Production Factors | Basic Economic Ideas

We dive into the concept of mobility of factors of production. By exploring the geographical and occupational mobility of production factors, viewers will gain a better understanding of how resources move within an economy.

1. Mobility of factors
of production
Economics
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What is mobility of production
factors?
❑It is the ease with which a factor
of production can move from
one place or use to another.
❑Geographical mobility is the ease
of movement from one region to
another.
❑Occupational mobility is the ease
of moving a factor from one use
to another.

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Mobility of land
Land cannot be moved from one
location to another.
But it can be employed for
alternative purpose where it can
be more useful, e.g. reclamation
of sea for residential use.

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Mobility of labour
Labour is both geographically
and occupationally mobile.

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Mobility of labour
Geographical immobility is
caused by cost of housing,
relocation cost, relationship with
family/friends, etc.
Occupational mobility is
hindered by skills requirements of
different occupations, lack of
information on job availability.

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Mobility of capital
Capital can easily be transported to
other locations even though the
bigger machines are not easily
moved around.
Some capital goods can be
adapted for other uses, e.g.
building, computers, etc.
Some capital goods are designed
for specific uses, e.g. printing press,
etc.

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Mobility of enterprise
It is a mobile factor of
production.
It can be moved from one
area/sector to another.
The hinderances are restrictions
of movement between countries,
some sectors require specific
skills.