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How land, labor, and capital were the building blocks of the US economy - Essay Example

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By: 10th Nov, 2013 Contribution of the factors of production towards the US economic growth The United States is the largest producer and economic power of the word. It produces more than half of the world’s output and the growth of the US economic is mostly attributed to the factors of production: land, labor, capital and entrepreneurs…
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How land, labor, and capital were the building blocks of the US economy
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By: 10th Nov, Contribution of the factors of production towards the US economic growth The United s is the largest producer and economic power of the word. It produces more than half of the world’s output and the growth of the US economic is mostly attributed to the factors of production: land, labor, capital and entrepreneurs. In this assignment the major focus is on land, labor and capital that has a major contribution towards US economic growth. The productivity of the US land and natural resources has increased with time. With efficient systems and technological improvements the US cropland value stood at the highest in 2013. (Nass.usda.gov, 2013) The waterways of the country have also contributed towards the economic growth by producing thousands of jobs in the shipping industry and on the seaport. The sailors and the ground staff are all beneficiaries of the inland waterways. These waterways also provide recreational enjoyment, hydropower and flood control mechanisms. For example, the Kentucky reservoir creates the following benefits to the economy apart from creating jobs in the system. (www.nationalwaterwaysfoundation.org, 2011) The climate change on a global scale has also affected the US economy. The Office of Climate Change and Technology deals with the policies related to mitigating the adverse climate changes affecting the economy. The mineral reserves of the US are enriched with metallic and non-metallic products that have continued to add value to the economic growth. The mineral related increasing economic trends can be seen as follows: (minerals.usgs.gov, 2012) The second factor of production playing its pivotal role in the US economic growth is labor. The US labor market has recovered after the recession and post 2009 the growth in employment is slow as compared to the modest economic growth. The government is continuously creating more and more jobs but the job creation is not sufficient enough to cover the aftermath of the recession. With the increase in the number of new jobs created the unemployment rate still linger around the same levels. The job creation cannot keep up with the increase in the quantity of labor. The GDP and employment growth can be tracked down from the following graph: (International Labor Organization, 2013) The US economy has seen new jobs being created in the private sectors while the government is continuously laying off people. The quality of workforce in the private sector has increased but the same cannot be said about the government offices. In terms of industry, most jobs are being created in the services sector with manufacturing sector actually losing jobs. The real work hours of the employees are stable but the corresponding pay in real terms has decreased. The composition of workforce as changed and unemployment has hit minorities and males more than the females in the workforce. The youth unemployment has also become a serious issue as more and more youngster are unemployed. The human capital composition is also affected by free public education where most of the youth is educated and unemployment causes a serious threat to their chances of getting higher education which can only be afforded with a well paying job. The third factor of production affecting the economic growth is the capital of a country. The US capital base has evolved through many innovations and inventions to become technologically smart and efficient. The agricultural innovations involved the use of precision techniques in farming. The use of satellite technology in farming is one of the greatest and most fruitful inventions of modern time. Farmers can easily track and plan their farming activities through this technology. In terms of the manufacturing sector the Advanced Manufacturing Office (AMO) performs research and development activities to improve the efficiency of the manufacturing sector. ‘Manufacturers in diverse industries reap the energy and cost benefits of the energy-efficient processes and materials developed with AMO support.’ (US Department of Energy, 2013) The superior energy performance has given a boast to the manufacturers’ output. The inventions like blast furnace gas recovery boiler provides the steel mill with efficient power and energy. In terms of communication the inventions are linked with the think pads and various gadgets that provide a Wi-Fi connection even in the remote area so that the work does not stop because of distances. The connectivity of the work world helps plan and execute orders in a timely manner thus improving productivity. For example, the US based technological giant IBM can strike deals globally through the online conferencing that reduces travel time and hazards and generates output quickly and efficiently. The transportation has come a great way from the era of the steam engines, the industrial revolution and the building of better transport infrastructure can deliver good in less time and in a more accurate and efficient manner. Thus the US economic growth is linked to the land, labor and capital and improvements in these factor of production has helped US fight the recession period and continue its steady climb of positive growth over the years. References: International Labor Organization (2013). Recent US Labor Market Data: June 2013. [online] Retrieved from: http://www.ilo.org/washington/ilo-and-the-united-states/spot-light-on-the-us-labor-market/recent-us-labor-market-data/lang--en/index.htm [Accessed: 09 Nov 2013]. minerals.usgs.gov (2012). Mineral Commodity Summaries 2012. [online] Retrieved from: http://minerals.usgs.gov/minerals/pubs/mcs/2012/mcs2012.pdf [Accessed: 07 Nov 2013]. Nass.usda.gov (2013). NASS - Charts and Maps - Farm Values and Cash Rents. [online] Retrieved from: http://www.nass.usda.gov/Charts_and_Maps/Land_Values/crop_value_hist_chart.asp [Accessed: 09 Nov 2013]. US Department of Energy (2013). EERE: Advanced Manufacturing Office. [online] Retrieved from: https://www1.eere.energy.gov/manufacturing/ [Accessed: 10 Nov 2013]. www.nationalwaterwaysfoundation.org (2011). Waterways: Vital to the Nation. [online] Retrieved from: http://www.nationalwaterwaysfoundation.org/study/Current_NWF_benes.pdf [Accessed: 08 Nov 2013]. Read More
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