Meaning: -In ordinary sense, land refers to the surface of the earth. But in economic sense, it includes all natural resources which are available on, above, and under the surface of the earth.
Definition: - “Land refers to all materials and forces which nature gives freely for man’s aid, in land, water, air. Light and heat.”
Defined by................... (Alfred Marshall)
Following are the some of the important Features of Land
1. Gift of Nature: -The nature has gifted land to mankind to carry out productive activities. Land is not created with human efforts. Land, as a factor of production, is not a man-made factor.Hence land has no cost of production.
2. Primary factor of production: - The other factors of production cannot carry out any productive activity without land. Therefore land becomes a primary factor of production.
3. Passive factor of production: - Land is a passive factor of production. Land becomes productive when the other factors of production such as labour, capital, etc., are used with it.
4. Permanent factor: - Land is not a perishable factor, it is a permanent factor. It cannot be destroyed. Thus, unlike labour and capital it is a permanent factor. However land resources such as forests, minerals etc., can get reduced.
5. Land is heterogeneous factor: -Land differs in fertility from place to place. Land can be graded on the basis of fertility and productivity. These are inferior lands in terms of productivity.
6. Lacks geographic mobility: - Land is geographically immobile because it cannot be shifted from one place to another. But it has occupational mobility, since it can be put to alternative uses. I.e. the same land can be used for producing various crops.
7. Fixed supply: -The supply of land is fixed or perfectly inelastic from the society’s point of view. It is possible to reclaim land from sea, but the reclaimed land does not amount to increase in land, as sea is also considered as part of land.
8. Rent as a reward: -The owners of the land get rent as a reward, when they allow others to use their land. The rent is the payment collected towards the use of the land. The rent varies from place to place from time to time.
9. Diminishing Returns: -Land is subject to the Law of diminishing marginal returns. As more and more inputs are employed on the same land, after a particular stage, the productivity starts diminishing.
