Everything about Land Economics totally explained
Land in
economics comprises all naturally occurring resources whose supply is inherently fixed (for example, doesn't respond to changes in price), such as at geographical locations (excluding
infrastructural improvements and
"natural capital", which can be changed by human actions),
mineral deposits, and even
geostationary orbit locations and portions of the
electromagnetic spectrum. In
classical economics it's considered one of three
factors of production (along with
capital and
labor). Income derived from ownership or control of natural resources is often referred to as
rent.
Land was sometimes defined in classical and
neoclassical economics as the "original and indestructible powers of the soil."
(External Link
) Georgists hold that this implies a perfectly
inelastic supply curve (for example, zero elasticity), suggesting that a
land value tax that recovers the rent of land for public purposes wouldn't affect the
opportunity cost of using land, but would instead only decrease the value of owning it. This view is supported by evidence that although land can come on and off the market, market inventories of land show if anything an inverse relationship to price (for example, negative elasticity).
Land, particularly geographic locations and mineral desposits, has historically been the cause of much conflict and dispute;
land reform programmes, which are designed to redistribute possession and/or use of geographic land, are often the cause of much controversy, and conflicts over the economic rent of mineral deposits have contributed to many civil wars, particularly in
Africa.
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