Skip to main content

Land utilisation

  LAND UTILIZATION  Land is a scarce resource, whose supply is fixed for all practical purposes. At the same time, the demand for land for various competing purposes is continuously increasing with the increase in human population and economic growth.Land use pattern at any given time is determined by several factors including size of human and livestock population, the demand pattern, the technology in use, the cultural traditions, the location and capability of land, institutional factors like ownership pattern and rights scale regulation. Major Types of Land Utilization in India : As in all other countries, land in India is put to various uses. The utilization of land depends upon physical factors like topography, soil and climate as well as upon human factors such as the density of population, duration of occupation of the area,land tenure and technical levels of the people.There are spatial and temporal difference in land utilization due to the continued interplay of physical and
Post a Comment

PRODUCER'S EQUILIBRIUM

PRODUCER'S EQUILIBRIUM
Meaning: Every firm aims at maximization of profits which can be possible only when the firms cost are minimum.Thus, the producers of firms aims at utilising the combination of factors of production at which it's cost are the least. Such combination is called as 'least cost combination'. It is that combination in which output is maximize at given cost. 
When the firm is producing desired output with the factor combination having the least cost ,it is said to be in equilibrium. It is stage where producer has no tendency either to expand or contract his output .

Producer's equilibrium can be explained in two ways :-
a) Marginal productivity analysis by neo -Classical economists.
b)Iso -producer analysis by modern economists.

Marginal product analysis
Ist case - Two factor case
Here, the firm uses two combination 

                   MPPl.          MPPk
                 _________. = _________
                       Pl.                 Pk

It explains that the last rupee spent on each of factor must be equal to each other .
In case ,if they are not equal ,suppose

                     MPPl.          MPPk
                  _________. >___________
                         Pl.                 Pk

More labour is used relative to capital ,since firm is getting greater physical return for its money from extra workers than from extra capital. However, the diminishing returns of labour will set in .Thus, MPPl will consequently fall. This will continue until they both will get to the equilibrium point.
This choice of technique is said to be most efficient and further changes cannot be made.It is the least cost way of combining the factors for any given output .
Efficiency in this sense of using the optimum factor proportion is known is productive efficiency.

2nd case - Multi-factor case
A firm will use many different factors ,the least - cost combination of factors will be when , 
    MPPa     MPPb.     MPPc.      MPPd
 _________=__________=__________=___________
     Pa.             Pb.             Pc.              Pd

If any inequality exists between the ratios,the form will be able to reduce costs by using more of factors which have high ratio until to the point they will become equal .

Comments

Post a Comment

Popular posts from this blog

MAJOR ISSUES IN INDIAN ECONOMY

Major issue facing Indian economy Introduction - After independence, India made progess in political, economic, social fields but many problems like poverty, unemployment and inflation are yet to be solved. Meaning - Economy means a money framework in which all economic activities of a country are explained. Indian economy is a mix economy whereby both private and public sector plays its role. The root cause of the 3 problems namely poverty , unemployment and inflation is population explosion that is increasing at very fast speed. These three problems are major challenges for Indian economy. Poverty Poverty has attracted attention of economists, sociologists and educationists . It exists when one is not able to get the basic necessities of life - food ,clothes and shelter. It is condition of lower standard of living, inability of an individual to get minimum requirement of food , education and health. It further indicates 3 direction  a) Economic inequality b) Economic dependence c) E
1 comment
Read more

Agricultural productivity

AGRICULTURAL PRODUCTIVITY   Agricultural Productivity of both land and labour is low in India. There are variations in productivity within the country and it is also low if compared to other countries of the world . It also provides that what measures should be adopted to improve the productivity of food and non-food crops and what measures are being adopted by the govt. to improve the productivity. CAUSES OF LOW PRODUCTIVITY IN AGRICULTURE   Millions of people still suffer from malnutrition and under nutrition which leads to starvation. There is no single reason for low productivity in agriculture in India. The causes of low productivity are as follows : (A) General Causes 1.Excessive Pressure of population on land . The heavy pressure of population on land is caused by the limited growth of employment opportunities in the non-agricultural sector for rural people and rapid growth of rural population. In 2011, about 52 percent of the population were employed in the agriculture-sector.
Post a Comment
Read more

Minimum support price scheme

MINIMUM SUPPORT PRICE SCHEME The best way to support agriculture is to invest in agri -R&D,agricultural-extension systems and connect farmers to lucrative markets,domestic and external, by building efficient value chains.  Giving farmers their right to choose technologies and best market is fundamental to the functioning of agri-system.  Minimum support prices (MSP) need to be made as legal instrument.  [It means that no one is allowed to buy crop below its MSP. But if it is accepted, it will turn out to be anti-farmer. ] Reasons  •It ignores that prices are decided by demand and supply.  •In case of surplus, which happens during harvest, prices fall to clear market.  •If MSP is above market clearing price, no one from private sector will buy.  •In this case, govt. Has to buy the farmers's produce otherwise farmers will turn to be worse off.  The govt. Declare MSP for 23 crops where the procurement happens largely to rice and wheat.  Why MSP crops and why not other agri prod
Post a Comment
Read more