Factor Market

Factor Market

Factor Market Jonathan Poland

The factor market, also known as the input market, is the market where the factors of production are bought and sold. The factors of production are the resources used to produce goods and services, including land, labor, and capital. In the factor market, these resources can be rented, leased, or purchased by businesses and organizations. The factor market is an essential component of the economy, as it allows businesses to access the resources they need to produce goods and services. This market is often studied in the field of economics, and plays a key role in the allocation of resources and the determination of prices.

The factor market is a concept that is often associated with simplistic and outdated economic models that view the economy as consisting of producers who buy unfinished inputs and consumers who buy finished goods. This narrow focus on the manufacturing sector ignores the complexity and diversity of modern economies. For example, the knowledge economy may require very few factors of production beyond labor, and the service economy often relies on the purchase of finished goods. Additionally, it is increasingly common for consumers to participate in production and for firms to purchase consumer goods. These developments highlight the limitations of the factor market model and the need for more nuanced and comprehensive approaches to understanding economic systems.

The following are common elements of the factor market.

  • Buildings
  • Business Services
  • Components
  • Electricity
  • Equipment Information
  • Technology Services
  • Infrastructure
  • Inventory
  • Labor
  • Land
  • Machines
  • Materials
  • Natural Resources (e.g. water)
  • Outsourcing
  • Parts
  • Vehicles
Learn More
Digital Goods Jonathan Poland

Digital Goods

Digital goods are products that are delivered and consumed in digital form, rather than as a physical object. These goods…

Thought Process Jonathan Poland

Thought Process

Thought is the mental process of perceiving, organizing, and interpreting information. It is the foundation of all higher cognitive functions,…

What is Marketability? Jonathan Poland

What is Marketability?

The marketability of a brand, product, or service refers to its competitiveness within a market. It is the likelihood that…

Risk Impact Jonathan Poland

Risk Impact

Risk impact refers to the potential consequences or losses that an organization or individual may incur as a result of…

Supply Chain 101 Jonathan Poland

Supply Chain 101

A supply chain is the network of organizations, people, activities, information, and resources involved in the production, handling, and distribution…

Brand Image Jonathan Poland

Brand Image

Brand image is the overall perception that consumers and the public have of a brand. It is the way that…

Quality Management Jonathan Poland

Quality Management

Quality management is a process that ensures products and services meet certain standards of quality before they are released to…

Types of Win-Win Jonathan Poland

Types of Win-Win

Win-win, also known as mutually beneficial, refers to a situation or plan that has the potential to benefit all parties…

Administrative Skills Jonathan Poland

Administrative Skills

Administrative skills are abilities and personality traits that enable a person to be efficient and organized in a workplace setting.…

Content Database

Search over 1,000 posts on topics across
business, finance, and capital markets.

Loss Leader Jonathan Poland

Loss Leader

A loss leader is a product or service that is sold at a price below its cost in order to…

Innovation 101 Jonathan Poland

Innovation 101

Innovation is the process of creating new ideas, products, or processes that add value to a company. This can be…

Sales Development Jonathan Poland

Sales Development

Sales development is a crucial part of the sales process that involves identifying potential buyers and developing qualified leads. This…

Bargaining Power Jonathan Poland

Bargaining Power

Bargaining power is a concept in negotiation theory that refers to the relative ability of parties to influence each other…

Price Economics Jonathan Poland

Price Economics

Price economics, also known as pricing strategy, is the study of how businesses determine the price of their products and…

Customer Journey Jonathan Poland

Customer Journey

A customer journey is the experience that a customer has with a company or brand over time, from their perspective.…

Operations Security Jonathan Poland

Operations Security

Operations security, also known as “opsec,” is the practice of protecting sensitive information in the context of day-to-day business activities.…

Customer Convenience Jonathan Poland

Customer Convenience

Customer convenience refers to any aspect of the customer experience that makes it easier and more efficient for them. This…

Domain Knowledge Jonathan Poland

Domain Knowledge

Domain knowledge refers to a person’s understanding, ability, and information about a specific subject or area. It is often associated…