PROPERTY 101
INTRODUCTION TO PROPERTY INVESTMENT
The term ‘Land’ in economics is often used in a wider sense. It does not mean only the surface of the soil, but it also includes all those natural resources which are the free gifts of nature.
It, therefore, means all the free gifts of nature. These natural gifts include: (i) rivers, forests, mountains and oceans; (ii) heat of sun, light, climate, weather, rainfall, etc. which are above the surface of land; (iii) minerals under the surface of the earth such as iron, coal, copper, water, etc.
According to Marshall, “By land is meant… materials and forces which nature gives freely for man’s aid in land, water, air, light and heat.” Therefore, land is a stock of free gifts of nature.
CHARACTERISTICS OF LAND:
Land possesses the following characteristics:
1. Free Gift of Nature:
Man has to make efforts in order to acquire other factors of production. But to acquire land no human efforts are needed. Land is not the outcome of human labour. Rather, it existed even long before the evolution of man.
2. Fixed Quantity:The total quantity of land does not undergo any change. It is limited and cannot be increased or decreased with human efforts. No alteration can be made in the surface area of land.
3. Land is Permanent:
All man-made things are perishable and these may even go out of existence. But land is indestructible. Thus it cannot go out of existence. It is not destructible.
4. Land is a Primary Factor of Production:
In any kind of production process, we have to start with land. For example, in industries, it helps to provide raw materials, and in agriculture, crops are produced on land.
5. Land is a Passive Factor of Production:This is because it cannot produce anything by itself. For example, wheat cannot grow on a piece of land automatically. To grow wheat, man has to cultivate land. Labour is an active factor but land is a passive factor of production.
6. Land is Immovable:
It cannot be transported from one place to another. For instance, no portion of India’s surface can be transported to some other country.
7. Land has some Original Indestructible Powers:
There are some original and indestructible powers of land, which a man cannot destroy. Its fertility may be varied but it cannot be destroyed completely.
8. Land Differs in Fertility:Fertility of land differs on different pieces of land. One piece of land may produce more and the other less.
9. Supply of Land is Inelastic:
The demand for a particular commodity makes way for the supply of that commodity, but the supply of land cannot be increased or decreased according to its demand.
10. Land has Many Uses:
We can make use of land in many ways. On land, cultivation can be done, factories can be set up, roads can be constructed, buildings can be raised and shipping is possible in the sea and big rivers.
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