The main factors of production and their relationship

To ensure and implement  directly manufacturing process requires certain conditions – factors of production. Sometimes they are also called resources. Resources include all items necessary for production (creation) of economic benefits.Depending on the type of production use one or the other set of factors. But some factors of production are the same and they still klassificeret the same type as the main factors of production. for the rest, all factors are divided into certain classes, and classifications, associations and groups.

The classification Process is based on different approaches. For example, the Marxist theory of shared economic resources and factors of production only two main and large groups – real and personal. personal factors, as a rule, refers to the labor force from a position of intellectual and physical abilities to work together. And under material factors mean the set of objects and means of labor and environmental conditions. But modern science is a division of the factors of production is not suitable. Therefore, in the second half of the nineteenth century this theory significantly expanded the concept of factors of production and their classification, consisting of three factors, but in the early twentieth century to the first three added a fourth. And this classification is used today with slight modifications and modernization, even this scheme is called classic. 

Thus, the basic factors of production according to the latest classification divided into labour, land, capital, and entrepreneurial ability. Consider the main factors of production separately and give a characterization.

Work from the point of view of production – physical or intellectual human activity, which aims to create some economic benefits. Recently, this factor has transformed into the concept of “human capital” which involves the consideration of educated labour and skilled worker as one of the main factors of production.

As for the earth, it refers to the primary factors of production, because it includes not only the land, but also water resources, forests, minerals and natural resources which are necessary for the production process. And in this case, all factors land is a fundamental resource of production. 

Capital (meaning the physical) -  represents an economic resource defined by a set of technical, financial and material resources that are necessary for the production of various economic goods. It is divided into two types: monetary and natural material. Cash capital, in fact is not an economic resource, it is a kind of mediating factor that is necessary to attract (acquisition) of human and physical capital. 

Entrepreneurial skills – these are the basic factors of production which are essentially properties of the labor but not the performing part of it and managerial and organizational. Despite the similarity in nature of this factor with performing work, this factor helps to create a form of income – entrepreneurial income. A minimum border of such income is profit. The remaining private factors income is not. Here to this factor include science as a specific form of human activity.

The Information also belongs to this group or type of factors. As it allows the collection and processing of various knowledge systematization for further use in the industrial and economic sphere of human activity. All the above mentioned factors are not rarely also called as permanent factors of production.