Explain the importance of land as a factor of production.
Importance of land:
i. Determines agricultural production: The supply of land resources determines the level of agricultural production in an economy. Nearly 43 percent of the land area of India is plain and suitable for cultivation of crops.
ii. Industrial development: Land resources of an economy help in the process of industrialisation. Raw materials needed for an industry are obtained from land. Power needed to run an industry is also supplied by land.
iii. Determines total production: The national output of a country depends to a great extent on the availability of land in that country.
iv. Influences the economic growth: The economic growth of a country depends on the growth rate of national output or per capita output. However, the growth rate of national and per capita output depends to a large extent on the availability of land and other natural resources. It enables a country to use its land resources in an efficient way to raise the level of national output and income.