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level: Immobile Factors of Production

Questions and Answers List

level questions: Immobile Factors of Production

QuestionAnswer
What is an Immobile Factor of Production? Is it an Example of Market Failure? -Make an Example with Land and Capital-A Factor of Production that can't be Easily moved to another Area of the Economy. This means there's an Inefficient Use of Resources - Unused or Underused. This means there's a Market Failure -Land can't be Moved from 1 Place to Another, and it may be Limited in what it can Do - Only can grow Wheat -Capital can be Immobile due to the Sheer Size - Factories or Nuclear Reactors [Specialist Nature]
Why, for Labour, can Geographical Immobility occur? [People can't move due to the sake of Moving]-Disparity in House Prices, Rent and Cost of Living - Cornwall vs South East England. Workers may not be able to Move -High Costs in just Moving Houses -Reluctant to Move due to Family, Friends and Change -Imperfect Information about Jobs available in Different Areas [They don't know if that's Advantageous]
Why, for Labour, can Occupational Immobility occur? [People can't move due to the Jobs] -What can this lead too?-Not enough Training, Education or Skills for a Different Job -Lack of relevant Qualifications or Membership [Doctors have to Register with General Medical Council] -Not enough Work Experience -Eventually this can cause Structural Unemployment
How can the Government help improve Labour Mobility?-Improving Geographical Immobility: Governments off Relocation Subsidies, or Mortgage Reliefs to make Moving to an Area more Affordable for Workers. Governments also to have more Construction of Housing in Areas where its Relevant -Improving Occupational Immobility: Provide more Training Programmes, Better Education, or help Workers to see Jobs in other Locations or Industries