Economic Activity, Agents, Factors of Production, and the Labor Market

Vocabulary flashcards defining fundamental concepts of economic activity, business classification, production factors, and the labor market.

Economic Activity (Actividad económica)

The set of tasks performed by people to obtain goods with which to satisfy their needs, encompassing material goods and services.

Production

The set of goods provided by economic activity, serving as one of the three basic components of economic activity.

Distribution

The process consisting of transporting production to the consumer and selling it in the market.

Market

The meeting place between producers and consumers where goods, merchandise, and services are bought, sold, or exchanged.

Consumption

The utilization of the goods provided by economic production.

Primary Sector

The economic sector that includes activities dedicated to extracting natural resources for production, distribution, or consumption, such as agriculture, livestock farming, forestry, and fishing.

Secondary Sector

The economic sector that encompasses activities dedicated to transforming natural resources supplied by the primary sector, including industry and construction.

Tertiary Sector

The economic sector comprising activities that provide services, such as transport, tourism, trade, education, and health.

Gross Domestic Product (GDP / PIB)

The aggregate wealth produced by a country, whose sectoral distribution shows major worldwide contrasts.

Economic Agents

The entities responsible for carrying out economic activity (enterprises, families, and the State) that interact within an economic circuit by exchanging labor, goods, and services for payments.

Enterprises (Empresas)

The basic units of production of economic goods whose function is to produce, distribute, and sell goods to consumers with the objective of obtaining economic profit.

Small Enterprise

An enterprise categorized by size that employs up to $50$ workers.

Medium Enterprise

An enterprise categorized by size that employs up to $250$ workers.

Large Enterprise

An enterprise categorized by size that employs more than $250$ workers.

Public Enterprise

An enterprise whose management and capital originate from the State.

Private Enterprise

An enterprise owned and managed by private individuals.

Mixed Enterprise

An enterprise whose ownership is funded by both public and private capital.

Public Limited Company (Sociedad Anónima / S.A.)

A corporate form of business organization whose capital is divided into shares.

Limited Liability Company (Sociedad Limitada / S.L.)

A corporate form of business organization whose share capital is contributed by a limited number of partners.

Cooperatives

Enterprises managed collectively by the partners who provide the capital.

Families (Familias)

The basic units of consumption whose function is to spend income on goods to satisfy their needs, selling their labor in exchange for wages.

The State (El Estado)

An economic agent functioning as both a unit of production and consumption, aiming to achieve social welfare by providing public goods, services, and infrastructure while collecting taxes.

Factors of Production

The four basic resources used by enterprises to carry out their productive activity: natural resources, capital, technology, and labor.

Natural Resources

Elements provided by nature that have economic utility, including water, atmosphere, soil, vegetation, animals, minerals, and energy sources.

Renewable Resources

Natural resources that recover within a short period of time, such as water.

Non-Renewable Resources

Natural resources that are depleted when used and require very long periods of time to recover, such as coal or petroleum.

Sustainable Development

The principle of using natural resources rationally so they meet current needs without compromising future generations, avoiding consumerism and promoting efficiency and recycling.

Physical Capital

Material elements necessary for production, such as facilities and machinery.

Financial Capital

Available monetary funds used to produce, such as cash and credits.

Human Capital

The productive capacity of people, which depends on factors such as their training and experience.

Manual Technology

A production technology where the human provides both the physical force and the handling of tools.

Mechanized Technology

A production technology where machines supply the force and humans operate and handle the machines.

Automated / Robotized Technology

A production technology where machines provide both the force and the operation, and humans only program and monitor them.

Labor (Trabajo)

The physical or intellectual effort carried out by people to produce material goods and services.

Active Population (Población activa)

The population segment comprising both people who have paid employment (employed population) and those available to work (unemployed population).

Inactive Population (Población inactiva)

People who do not perform and are not available to perform paid work, such as pensioners, rentiers, students, and domestic homemakers.

Activity Rate (Tasa de actividad)

The percentage of the active population relative to the total working-age population ($16$ years and older), calculated as $\frac{\text{Active population} \times 100}{\text{Population aged } 16 \text{ and older}}$.

Unemployment Rate (Tasa de paro)

The percentage of the unemployed active population relative to the total active population, calculated as $\frac{\text{Unemployed active population} \times 100}{\text{Active population}}$.

Labor Market (Mercado laboral)

The market composed of the supply of labor offered by enterprises and the demand for labor requested by individuals.

Collective Agreements (Convenios colectivos)

Agreements negotiated between employers' associations and workers' trade unions that regulate labor conditions in advanced economies.

International Labour Organization (OIT / ILO)

An international organization that promotes basic labor standards, including the ban on child labor, gender non-discrimination, and workers' rights such as a minimum wage and trade union freedom.