Economic Life Around Us – 7: Factors of Production

Flashcards covering key concepts from the Factors of Production module: land, labour, capital, entrepreneurship, technology as a facilitator, human capital, education, health, demographics, CSR, supply chains, and examples like Tata and modern tech applications.

What are the four factors of production and the role of technology?

Land, labour, capital, and entrepreneurship are the four factors; technology is a facilitator that helps produce more with the same or fewer inputs.

How is 'land' defined in economics?

Land includes geographical land and natural resources like soil, forests, water, air, sunlight, minerals, oil, and natural gas.

What is the difference between labour and human capital?

Labour is the physical and mental effort used in production; human capital is the specialized knowledge, skills, abilities, and expertise required to perform that labour.

What is 'capital' in economics?

Capital is any asset used to produce goods and services, including money and durable assets such as machinery, tools, equipment, vehicles, and buildings.

What is entrepreneurship?

Entrepreneurship means starting a business or creating something new to solve a problem; an entrepreneur combines factors, takes risks, and makes decisions to bring innovations to market.

What is a startup?

A startup is an entrepreneurial venture with limited resources aiming at rapid growth and expansion, often leveraging technology.

What are facilitators of human capital?

Education and training (to build knowledge and skills) and healthcare (to maintain health).

Why is education important for human capital?

Education helps individuals gain knowledge—from basic literacy to expertise in specific fields—and enables them to solve real-world problems.

What is the role of healthcare in human capital?

Good health supports cognitive development and enables workers to perform better and be more productive.

What is the adult literacy rate in India as of 2023?

85% for males and 70% for females (World Bank estimates).

What is the demographic dividend?

A potential growth benefit when a country has a large working-age population; more people work and earn, fewer dependents, boosting growth if education, health, and skills are available.

What is kaizen?

A Japanese concept meaning continuous improvement.

What is the German work ethic?

A culture of punctuality, attention to detail, and quality contributing to high-quality industrial output.

What is CSR and its significance in India?

CSR stands for Corporate Social Responsibility; it involves companies addressing social and environmental concerns, with a 2014 law mandating 2% of average profits over three years to be spent on CSR activities.

What are the responsibilities towards workers mentioned in the text?

Fair compensation and safe working conditions; skill development and training; workplace rights and protections.

What is supply chain?

A network of individuals, organizations, resources, activities, and technology involved in the production and sale of goods; disruptions can halt production (e.g., COVID-19).

What is an example of labour-intensive vs capital-intensive sectors?

Labour-intensive: agriculture, construction, handicrafts; capital-intensive: semiconductor chips, satellites.

How does technology enable everyday business activities?

Technology enables digital payments (UPI), weather updates for farmers, GPS for routing, and online learning platforms, while some older technologies remain in use.

What online platforms support learning and job opportunities mentioned in the notes?

SWAYAM (free online courses) and National Career Service (job opportunities across sectors).

What is the purpose of the mobile phone manufacturing flow chart in the notes?

To illustrate how inputs from land, labour, capital, and entrepreneurship, guided by R&D and design, come together to produce and distribute a product.