Any economic system faces a dilemma: on the one hand, the needs of society are limitless, completely insatiable; on the other hand, the resources of society necessary for the production of goods are limited or rare. The problem of limited resources is a fundamental economic problem.

Limited goods means that for any individual and society as a whole, most goods and services are limited, that is, they are not enough to satisfy all needs. Limited resources mean that the production capabilities of society are limited, that is, society is forced to produce a limited amount of goods. By increasing the production of one good, society is forced to reduce the production of another. When choosing one production option, you have to sacrifice other options. Society is faced with a choice of which goods to produce and which to refuse. This problem has faced all economic systems in the past, it faces today and will face tomorrow.

Using the simplest model, let us consider the production capabilities of society. Let's consider a hypothetical economy in which two goods are produced - X and Y. Let's also assume that the amount of resources and production technology are constant. Let us assume that this economic system is efficient, that is, it operates under conditions of full employment of resources and full volume of production.

If absolutely all resources are directed to the production of good X, then society will receive the maximum amount of it. In this case, good Y will not be produced at all (option A). Another alternative is possible when all the resources of society are directed to the production of good Y. In this case, good Y is produced in maximum quantity, and good X is not produced (option B). However, society needs both goods at the same time, for which it is necessary to reduce the production of each of these goods below the maximum. In this case, there are many alternative options for production combinations of resources and the corresponding production structure (for example, options C, D, E). This situation can be depicted graphically. Let us plot the quantity of good X horizontally, and the quantity of good Y vertically. As a result, we obtain a production possibilities curve. Each point on this curve represents a certain combination of two types of goods. For example, point C represents the combination Xc pcs. goods X and Yc pcs. product Y.

Production possibility curve shows" the maximum possible volume of simultaneous production of two goods with given resources and technologies available to a given society.

The economy is efficient, when all points of possible combinations of production of two goods are on the production possibilities frontier (i.e. A, B, C, D, E). The economic system is inefficient, when various combinations of production of two goods are to the left of the production possibilities frontier (point F). In this case, the resources of society are not fully occupied (unemployment, underutilization production capacity, backward technology). Point F represents a combination of goods X and Y that is significantly less than could be produced with full and effective use available resources. Society must do whatever is necessary to move to the production possibilities frontier. For a society that has a certain supply of resources and knowledge and ensures the full volume of production, point G is currently unattainable. Any economic system at any given time has limited capabilities and cannot move beyond the production possibilities frontier.

The problem of choice is the main problem associated with limited resources. However, limited resources lead to the emergence of several more. Such problems are competition, rationing and discrimination. Since there are many options for using resources, and the supply of these resources is limited, competition inevitably arises. Competition- economic competition between commodity producers aimed at obtaining at their disposal the largest number resources. Rationing- a distribution system that establishes the maximum amount of a good or resource that an economic unit can acquire. Rationing is a method of distributing a good or resource whose supply is lower than demand. In a free market this situation does not arise. At one time, rationing was widely practiced in our country, which since 1917 has experienced various types of shortages and the subsequent rationing. As an exceptional measure, rationing also takes place in the economies of developed countries. For example, in the USA during World War II it was quite effective. Discrimination- restriction or deprivation of access to any benefits of certain categories of citizens on the basis of race, nationality, social origin, political views, etc. An example would be discrimination in the labor market.

The production possibilities curve shows that an increase in the production of one good is possible only by simultaneously decreasing the production of another good. The content of the problem of choice is that if the economic resource used to meet the needs of society is limited, then there is always the possibility of its alternative use. What society refuses is called the opportunity (hidden or alternative) costs of achieving the chosen result. Let's compare points C and D. Having chosen point C, society will prefer to produce more goods Y (Y c) and less goods X (X C) than choosing point D and producing goods Y - Y D, and goods X - X D. When moving from point C to point D, society will receive an additional amount of good X (ΔХ = X D - X c), sacrificing for this some amount of good Y (ΔY = Y C - Y D). Opportunity Cost of any good - the amount of another good that must be sacrificed in order to obtain an additional unit of this good.

The production possibilities curve is concave from the origin, demonstrating that an increase in the production of one good is accompanied by an increasing decrease in the production of another good. Based on these observations, we can formulate law of increasing opportunity cost: In a full-employment economy, as production of one good increases per unit, more and more of another good must be sacrificed. In other words, the production of each additional unit of good Y is associated for society with the loss of an increasing amount of good X. The operation of the law of increasing opportunity costs is explained by the specifics of the resources used. In production alternative goods Both universal and specialized resources are used. They vary in quality and are not completely interchangeable. A rationally acting economic entity will first involve in production the most suitable, and therefore the most effective, resources, and only after they are depleted - less suitable ones. Therefore, when producing an additional unit of one good, universal resources are initially used, and then specific, less efficient resources are involved in production, which can only be partially used. In addition, in the production of alternative goods, consumption rates for the same materials differ significantly. In conditions of scarcity and lack of interchangeability of resources, opportunity costs will increase as the production of an alternative good expands. If any unit of input were equally capable of producing alternative goods, then the production possibilities curve would be a straight line

Production capabilities of society - these are the possibilities of society for production economic benefits with full and efficient use of all available resources at a given level of technology development. Since resources are limited, society is forced to make technological choices, deciding which needs should be satisfied and which should not.

Thus, the limited resources determine the alternative nature of their use and necessitate an alternative choice from among the mutually exclusive possibilities of the most optimal option from the point of view of the goals of society. Alternative choices between resource uses can be represented by a production possibilities curve.

Production possibility curve shows the maximum possible volume of simultaneous production of two goods with full use of limited production resources, when, at a given level of production and available technology, there are no resources to increase the volume of production.

The economy is efficient , when all points of possible combinations of production of two goods are on the production possibilities frontier (i.e. A, B, C, D, E). The economic system is inefficient , when various combinations of production of two goods are to the left of the production possibilities frontier (point F).

In this case, society's resources are not fully occupied ( unemployment , incomplete utilization of production capacity, backward technology). Point F represents a combination of goods X and Y that is significantly less than could be produced with full and efficient use of available resources. Society must do whatever is necessary to move to the production possibilities frontier.

For a society that has a certain supply of resources and knowledge and ensures the full volume of production, point G is currently unattainable.

8. Main factors of production and their interaction.

Factors of production- These are the resources necessary for the production process.

Exists four main factors of production:

1) labor. This is the economic activity of people aimed at generating income and satisfying needs. In the process of work, a person expends physical and mental energy. In various types of work, intellectual labor or physical labor may predominate. Labor can be simple and complex, skilled and unskilled. The result of labor can be a material (a residential building, a parking lot, a bridge over a river) or an intangible product (for example, information, a service);

2) capital. These are means of production for long-term or short-term use (raw materials, machinery, equipment, structures). Separately, money capital is distinguished - financial assets intended to be converted into real ones. Money itself is not a factor of production, but it plays a significant role in the activities of an enterprise;

3) land (natural resources). Earth is every place where a person is (resting, working, etc.). There are a variety of businesses located on the land. The earth is a source of minerals and natural resources. Land as an economic factor takes into account all these functions of natural factors in the economy;

4) technical progress. Industrial installations may have the same cost, but one may be new and the other obsolete. If other factors of production are the same, then the best economic results will be achieved by an enterprise using modern equipment;

5) information. Due to the widespread use of computer technology, information begins to play a significant role in production. Possession of information helps an enterprise to carry out its activities more efficiently.

Interaction and combination of production factors. Production requires certain resources, which are used in the right combinations. All resources cannot participate in production in isolation. They interact only in certain combinations. They all complement each other. At the same time, they interact. For example, machines and equipment can be replaced by the labor of workers, natural materials - by artificial ones.

When one type of resource becomes more expensive for some reason, they try to replace it with a cheaper one, and accordingly, the demand for it increases. An increase in demand can lead to an increase in the price of a particular resource. Therefore, a change in the price of one resource leads to a change in the prices of other resources.

The supply of production factors primarily depends on the specifics of each market. Depending on market development factors, the offer is formed. However, what all markets have in common is that the amount of resources offered for sale is limited compared to the needs for their production.

For a manufacturing enterprise, market prices are of great importance. The level of production costs depends on them. With available technical base prices will determine the amount of resources that can be used.

Labor (labor force)

Natural resources

ENTREPRENEUR

Type of income

Salary

(entrepreneurial activity)

Rice. 2.1. Main types of production resources and income from their use

always causes controversy in society, since its meaning is ambiguous: for the tenant it is payment for the main agricultural resource and is included in production costs; for the landowner, this is the usual income on the capital invested in the land; finally, for society this rent is a kind of tribute paid to landowners by buyers of agricultural products. It is obvious that the presence of the owner of the land and its payment often contribute to increasing the efficiency of use of land resources.

Interest (in this case) is the payment of the entrepreneur (borrower) to any individual or legal entity(creditor), who provided him with his monetary, or real, capital for the use of this capital. The lender may be a bank that has lent money to an entrepreneur to purchase means of production; a bondholder of a firm who has lent it some of his money; any lessor who leases outbuildings, equipment and other capital resources owned by him. An entrepreneur's income is profit, i.e. remuneration (payment) to the entrepreneur for the work (expense) of it entrepreneurial skills, i.e. for the fact that he paid for and collected together labor, natural and capital factors of production, and also organized their economic functioning and assumed responsibility and risk for their effective use. I! In any business, risk is inevitable. Profit (if it is semi-The production capabilities of society depend on how economic resources are used in the economy.

It has already been noted that there is an inverse relationship between the needs of people and the capabilities (productive resources) to satisfy them: if the former are limitless, then the latter are very limited, that is, they can be used in quantities not exceeding a certain limit, limit. Due to limited production resources, people are constantly faced with the problem of choice: what and how much to produce, sell, buy. Limited resources mean that choosing one product leads to the rejection of another (for example, what is better: eating your favorite ice cream or buying an interesting book?). When managing an economy, you have to choose ways to use resources that will satisfy your most preferred needs, that is, which goods and services should be produced and which will have to be abandoned. In this regard, let us turn to the concept of production capabilities.

Production possibilities are the maximum quantity of goods and services that can be simultaneously produced over a given period of time, given resources and technology. This means the efficient use of all available resources ( labor force, means of production and other economic factors). For clarity, let's consider conditional example. It is known that an economic economy produces two groups of products: means of production (production goods) and consumer goods (consumer goods). In our example, for simplicity, they are collectively represented by machines and books. The general limitation of resources allows these goods to be produced during the year in the following alternative ratios:

a) ten presses with zero book output;

b) nine machines and one book;

c) seven machines and two books, etc. (Table 2.1).

On the graph (Fig. 2.2), constructed according to the data in Table. 2.1, point A reflects a situation in which all resources are directed to the production of machines, and point D represents an alternative when only books are produced. In reality, society tries to avoid such extremes and always strives to find the balance it needs in

Distribution of production. Points B, C and D represent alternative options for such a balance, i.e. the maximum possible volume of simultaneous production of both machines and books in various combinations (more machines - fewer books, and vice versa). Limited material and human resources make any combination of production of machines and books beyond the production possibilities frontier (PPF) unfeasible, for example, at point I (from the word “impossible”), corresponding to the production of two units of machines and seven units of books. In contrast, the production combination at point M (from the word “possible”) is quite real, but resources are used incompletely and inefficiently (low labor force employment and labor productivity, unloaded factories, excessive raw material costs, etc.). Consequently, there are reserves here to increase the production of one

product without reducing the output of another.

9 1Border

production capabilities

Thus, only points located on the production possibilities frontier correspond to the most efficient use of available resources to produce certain goods and services. Society must only choose the desired combination of them.

Rice. 2.2. Production possibility curve at full use of resources

Production capabilities reflect the maximum production with full use of given resources and technologies. However, over time, resources and technologies usually change progressively: the number of labor increases and

New GPV line

means of production, their quality improves, technologies are improved, etc. All this expands the possibilities of production, and consequently, the GPV line shifts to the right of the center of coordinates. The capacity of a society to produce different products most often does not grow to the same extent.

Books, million copies

Rice. 2.3. Production possibility curve under conditions of economic growth

Thus, considering our example with the production of books and machine tools in the conditions of increasing resources and technological progress, let us assume that the book publishing base has doubled, and the machine tool industry has doubled by 40%. Then new production alternatives for the production of books and machines will arise (Table 2.2, Fig. 2.3), and the new GPV line will take the following position on the graph. Thus, technological progress, growth in quantity and quality

human and material resources make it possible to increase the output of goods and services.

The reasonable choice of a specific production alternative at the present time largely determines production capabilities and the growth of society's well-being in the future.

3.2. Main features of commercial farming

Having become acquainted with the factors of production, let us now turn to the question of their use for output. various goods and services. The production capabilities of society depend on the specific “distribution” of resources in the economy. For Russia, this problem is more than relevant. In socialist times, in the huge and then even richest Soviet Union, few people think about severe limitations and interdependence of economic resources society. By limitlessly increasing the production of, say, combines at Rostselmash, business executives did not want to notice that this was taking away the country’s opportunity to at least mitigate the situation with the shortage of household vacuum cleaners and refrigerators.

The problem of choice and the production possibilities frontier

Thus, between needs people and opportunities To satisfy them, there is an “unpleasant” but inevitable feedback: if the former are unlimited, then the latter are very limited. From here people constantly face problem of choice. Even in everyday life, at every step we solve problems like “what is better”: eat your favorite ice cream or buy an interesting book? In economics, this problem manifests itself in the need to choose between alternatives : which goods should be produced and which ones will have to be abandoned. Because limited resources also mean limited production. By placing emphasis, for example, on the production of “guns,” society will inevitably be forced to reduce the production of “butter.” This brings us to the concept of production possibilities.

Production capabilities– This is the maximum amount of goods and services (in a certain set of them) that can be simultaneously produced for a given period given resources and technologies. This means that all available resources (labor, means of production and other economic factors) are used most fully and efficiently.

For clarity, let's consider conditional example. It is known that each economy produces two large groups of products: means of production (production goods) and consumer goods (consumer goods). In our example, for the sake of simplicity, let us collectively represent them as machines and books. The general limitation of resources allows for the production of these goods per year, for example, in the following alternative ratios: either (A) 10 units of machines with zero production of books, or (B) 9 units of machines + 1 unit of books, or (IN) 7 units of machines + 2 units of books and so on (Table 2.3). Based on the data from this table, you can construct a graph, the curved line of which will reflect production possibilities frontier (GPV) for machines and books in our example (Fig. 2.13). Thus, point A shows an alternative in which all resources are directed to the production of machines, and point D shows a situation where only books are produced. However, these are two clearly unrealistic extremes. In fact, society always strives to find the balance it needs in the distribution of production. Points B, C And G They represent alternative options for such a balance, i.e. maximum possible volume of simultaneous production And machine tools, And books in their various combinations. Moreover, more machines mean fewer books, and vice versa.

Table 2.3

Possibility of annual production of books and machines with full use of resources

At the same time, limited material and human resources make any combination of production of machines and books unfeasible outside GPV lines - say, in point N (from the word “impossible”) with the release of 2 units of machines and 7 units of books. In contrast, production combinations inside SAP (for example, in point M - “can”) are quite real, but at the same time, resources are used incompletely and inefficiently (unloaded factories, low employment of labor in society, low labor productivity, excessive costs of raw materials, etc.). Accordingly, there are reserves for increasing the production of one product without reducing the output of another.

Thus, only points on the production possibilities frontier show the most efficient use of available resources to produce certain goods and services.

Society should only You

Rice. 2.13.

take the desired combination. In this case, however, you will have to “pay” for the choice made with so-called implied (or hidden) costs, which we will now turn to consider.

• Alternative (from Latin alter – one of two) – (1) necessity choosing one of two or more mutually exclusive options; (2) each of these mutually exclusive possibilities.
• Accent (from Latin accentus - emphasis) - (1) emphasis in a word; highlighting sound by amplifying it; (2) concentration of attention or effort on something, emphasis on something; (3) involuntary distortion of sounds by a person speaking a foreign language.

Production capabilities of society. Production possibilities curve. Technological choice of society

Production capabilities of society - these are the possibilities of society for production economic benefits with full and efficient use of all available resources at a given level of technology development. Since resources are limited, society is forced to make technological choices, deciding which needs should be satisfied and which should not.

Thus, the limited resources determine the alternative nature of their use and necessitate an alternative choice from among mutually exclusive possibilities of the most optimal option from the point of view of the goals of society. Alternative choices between resource uses can be reflected in the form of a production possibilities curve.

Production possibility curve shows the maximum possible volume of simultaneous production of two goods with full use of limited production resources, when, at a given level of production and available technology, there are no resources to increase the volume of production.

The economy is efficient , when all points of possible combinations of production of two goods are on the production possibilities frontier (i.e. A, B, C, D, E). The economic system is inefficient , when various combinations of production of two goods are to the left of the production possibilities frontier (point F).

In this case, society's resources are not fully occupied ( unemployment , incomplete utilization of production capacity, backward technology). Point F represents a combination of goods X and Y that is significantly less than could be produced with full and efficient use of available resources. Society must do whatever is necessary to move to the production possibilities frontier.

For a society that has a certain supply of resources and knowledge and ensures the full volume of production, point G is currently unattainable.

So, any economic system at any given time has limited capabilities and cannot move beyond the production possibilities frontier .