Land as a Factor of Production and Scarce Resource
AbstractAim and Objective: The aim and objective of this study is to explore the real value of land and the unfavourable factors that affects the demand and supply of land. The study aims to prove my theory about land. This theory suggests that all natural resource gains its logic of ‘buying and selling’ by employing all other resources to limit the demand of land in production activities. Method: Two Surveys was designed from two stage stratified random sampling. The primary sampling units were selected from the main sample frame (1328, 1704 regions from 2600, 36196 regions, respectively). The final sampling units were selected randomly from the primary sampling units (12,12 families from every 1328,1704 regions, respectively) using a systematic random sample. Findings: For a chosen city, the price growth rate of land is 93.77 % yearly for residential areas and 118.98% yearly for commercial areas. However, this has exceeded the cost and the price growth rate of construction materials and has resulted to the inflation of other materials. This explains clearly why around 83.15% planned areas and 198.23% unplanned areas are raw land. Here, much less than 29.47% of the population owns a house without loan. Conclusion: Conclusively, for a market in equilibrium at a certain price, the limitation of the demand of land in production activity will make the free supply curve more elastic. It was proven that if we deactivate the nonproduction (re-sale) demand of land for a market in equilibrium at a certain price, the supply of land will be greater than the demand of land. In addition, there will be no significant output unless we consider the real value of land as a part of a house or a project.
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How to Cite
Jughaiman, A. (2017). Land as a Factor of Production and Scarce Resource. European Scientific Journal, ESJ, 13(5), 175. https://doi.org/10.19044/esj.2017.v13n5p175