home Training Labor as the most important production factor scientific article. Labor as a factor of production. labor theories. Production function and its factors

Labor as the most important production factor scientific article. Labor as a factor of production. labor theories. Production function and its factors

Labor as a factor of production

Parameter name	Meaning
Article subject:	Labor as a factor of production
Rubric (thematic category)	Production

There are factors without which the concept of production would not make sense, and these are factors that affect the volume of production. Factors of production efficiency are quite diverse, since there are a great many resources for it. There are three main groups of factors: land, labor and capital. Water, forests, fields, minerals, etc., that is, something given by nature or created by man (for example, drained swamps) - ϶ᴛᴏ land.

Labor as a factor of production is very important and relevant, since it means the participation of a person in the production process, the use of his own energy and potential. The main elements of labor include objects of labor, means and expedient human activity. The main results of labor: economic benefits, human development (physiological and mental), human living conditions, accumulation of knowledge and experience.

Labor - ϶ᴛᴏ is not just an engine of progress, labor is the basis of human existence and life, because under its influence the brain, speech develops, experience is accumulated, skills are improved.

Labor as a factor of production has content and character.
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According to the content, low-skilled, medium-skilled and highly skilled labor is distinguished.

Labor has both quantitative and qualitative characteristics. Qualitative characteristics - this is the level of qualification of employees, quantitative - ϶ᴛᴏ costs (number of employees, intensity of labor activity, work time). The more time it takes to educate and train a specialist, the more qualified he is.

In order to determine the nature of labor, it is necessary to conduct a thorough analysis of the combination of labor force and means of production, to clarify who and in what quantities appropriates the results of labor. With this in mind, there are three basic social species labor: free, hired and forced. Forced labor - ϶ᴛᴏ forced labor (slave labor). Today, the first two types of labor activity meet.

Free labor is voluntary.
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This is labor activity for oneself, when the owner and worker act in one person. A typical example of such activity: entrepreneur, farmer, etc. If the labor activity is hired, then the employer and employee - ϶ᴛᴏ different people, their relationship is formalized employment contract, sometimes by agreement or contract, and according to the results of labor, the employee receives a certain monetary reward.

Stayed for a long time controversial issue whether labor acts as a factor of production or whether it work force. The physical, mental and intellectual abilities of a person are the labor force. If the employer is interested in the ability of a person to work, then the factor of production is the labor force. If the duration of working time is important for him, then this factor is labor. In order to work qualitatively, a person must have a certain health, abilities and skills, it follows that the labor force exists before the start of the labor process.

Labor productivity - ϶ᴛᴏ the ratio of the result of labor (the number of products produced) in a certain period of time. Labor productivity, in turn, depends on a number of factors that can affect it.

33. Capital (from lat. capitalis- main, main property, main amount) - a set of assets used to make a profit in the future. The direction of assets in the sphere of production or provision of services for the purpose of making a profit is also called capital investments or investments.

There are physical (material capital) and human capital. physical capital- non-expendable property (buildings, machines, equipment) used by the company in its activities. Distinguish between fixed and circulating physical capital. Main capital- real durable assets, the value of which is transferred to the product in installments over a number of periods of production (buildings, structures, machinery, equipment, vehicles etc.). Working capital- real assets, the value of which is fully transferred to the cost of a new product and returned in cash to the entrepreneur when the product is sold in each cycle (raw materials, fuel, materials, semi-finished products). Human capital- the physical and mental abilities of a person obtained through education or practical experience; a measure of the ability to generate income embodied in a person. In other words, human capital is a special kind labor resources. For this reason, capital in the market of factors of production means material factors, capital goods. Another aspect of capital is related to its monetary form. Money capital is the common denominator to which the value of capital in the form of any asset is reduced. In monetary terms, the value of both physical and human capital must be calculated. Capital embodied in the means of production is called real capital. money capital, or capital in cash, is an investment resource. By itself, money capital is not an economic resource; it cannot be used directly in production, but it can be used to purchase factors of production.

35. Entrepreneurship - a way of doing business on an independent basis.

The basic functions of modern entrepreneurship include:

‣‣‣ Financial and accounting management. Financial management involves the mobilization of capital, the accumulation of income from entrepreneurial activities, the management of the use of capital and income. The main task of entrepreneurship is to ensure the maximum return of entrepreneurial activity with minimal risk.

‣‣‣ personnel function . Personnel management includes the selection of candidates and hiring, personnel management of the organization. Personnel management - a system of management activities in the field of social and labor relations of the organization's staff.

The competitive advantages of a kick of all strata, as well as a separate enterprise, today are largely determined by human resources. According to the calculations of the World Bike, in the composition of the national wealth of the United States, the main production assets (buildings and structures, machinery and equipment) make up only 19 51, natural resources - 5% human capital - 76%. In Western Europe, the corresponding figures are 23.2 and 74%. In Russia - 10, 40 and 50%. At the same time, investments in human resources are growing, which makes the problem of their payback important.

‣‣‣ Logistics. This activity covers operations for the acquisition of raw materials, machinery and equipment. The main task at this stage is the uninterrupted supply of production with the necessary resources at minimal cost.

‣‣‣ production function. Production involves the transformation of raw materials, materials and semi-finished products into a finished product. Production management is associated with technical and technological aspects and is aimed at finding such a combination of factors of production that, with minimal production costs, would maximize profits.

‣‣‣ Marketing involving the definition of consumer needs. Marketing is a system of accounting for consumer preferences and impact on the consumer, designed to ensure the sale of products on the market. At this stage, the task of the entrepreneur is to identify consumer preferences, and often the formation of new ones.

‣‣‣ Research activities aimed at creating new technologies, updating the management system, developing and issuing new products. In the age of the scientific and technological, and then the information revolution, scientific discoveries and their technological application play an increasingly important role and largely determine the position of an enterprise in the market, and, consequently, the amount of entrepreneurial income.

‣‣‣ Public relations, implying the management of relations between the company and public structures (public authorities, consumer societies, trade unions, the media).

37. Macroeconomics (from other Greek μακρός - long, big, οἶκος - House and Nόμος - law) - a science that studies the functioning of the economy as a whole, the economic system as a whole, the work of economic agents and markets; set of economic phenomena.

The science of macroeconomics deals with questions that cannot be answered at the microeconomic level: the problems studied by macroeconomics are common to the economy as a whole. Macroeconomic issues include:

§ Economic growth, economic cycles: What is economic growth? How to determine the rate of economic growth? What factors can influence economic growth? How does economic growth affect the development of the country in question?

§ Unemployment: Who are the unemployed? Is unemployment good or bad for the economy? How to deal with unemployment? How can you determine the different levels of unemployment in a country? What is the impact of unemployment?

§ General price level: What is meant by the general price level? How do changes in the price level affect the state of the economy? What is inflation? Which inflation is good and which is bad?

§ Money turnover, interest rate level: What is the role of money in macroeconomics? What affects the general interest rate and what does it affect in the economy?

§ The state budget: How does the state regulate its revenues and expenditures? How do such criteria as the well-being of society or the development of business in the country depend on changes in the state budget?

§ Trade balance: How does the country implement international trade with other countries? How do changes in exports and imports affect the exchange rate, the development of the country in question, the state of the world economy?

Labor as a factor of production - concept and types. Classification and features of the category "Labor as a factor of production" 2017, 2018.

Labor as a factor of production is also a heterogeneous concept, in a complex meaning the cumulative efforts of people. Since there are a lot of professions and specialties, and each of them requires specific knowledge and skills, appropriate training is needed to obtain them. Training allows you to acquire this knowledge and improve existing skills. The population capable of working is called the labor force. For Russia, the labor force is made up of men (18-60 years old) and women (18-55 years old).

Labor as a factor of production is very important and relevant, since it means the participation of a person in the production process, the use of his own energy and potential. The main elements of labor include objects of labor, means and purposeful human activity. The main results of labor: economic benefits, human development (physiological and mental), human living conditions, accumulation of knowledge and experience.

Labor is not just an engine of progress, labor is the basis of human existence and life, because under its influence the brain, speech develops, experience is accumulated, skills are improved.

Labor as a factor of production has content and character. According to the content, low-skilled, medium-skilled and highly skilled labor is distinguished.

Labor has both quantitative and qualitative characteristics. Qualitative characteristics - this is the level of qualification of employees, quantitative - these are costs (number of employees, intensity of labor activity, working hours). The more time it takes to train and train a specialist, the more qualified he is.

In order to determine the nature of labor, it is necessary to conduct a thorough analysis of the combination of labor force and means of production, to clarify who and in what quantities appropriates the results of labor. With this in mind, three main social types of labor are distinguished: free, hired and forced. Forced labor is forced labor (slave labor). Currently, there are the first two types of labor activity.

Free labor is voluntary. This is labor activity for oneself, when the owner and worker act in one person. A typical example of such activity: entrepreneur, farmer, etc. If labor activity is hired, it means that the employer and employee are different people, their relationship is formalized by an employment contract, sometimes an agreement or contract, and based on the results of work, the employee receives a certain monetary reward.

For a long time there was a controversial question whether labor acts as a factor of production or is it a labor force. The physical, mental and intellectual abilities of a person are the labor force. If the employer is interested in the ability of a person to work, then the factor of production is the labor force. If the length of working time is important for him, then this factor is work. In order to work qualitatively, a person must have certain health, abilities and skills, hence it follows that the labor force exists before the start of the labor process.

Labor as a factor of production is very important and relevant, since it means the participation of a person in the production process, the use of his own energy and potential. The main elements of labor include objects of labor, means and purposeful human activity. The main results of labor: economic benefits, human development (physiological and mental), human living conditions, accumulation of knowledge and experience.

Labor is not just an engine of progress, labor is the basis of human existence and life, because under its influence the brain, speech develops, experience is accumulated, skills are improved.

Labor as a factor of production has content and character. According to the content, low-skilled, medium-skilled and highly skilled labor is distinguished.

In order to determine the nature of labor, it is necessary to conduct a thorough analysis of the combination of labor force and means of production, to clarify who and in what quantities appropriates the results of labor. With this in mind, three main social types of labor are distinguished: free, hired and forced. Forced labor is forced labor (slave labor). Currently, there are the first two types of labor activity.

Free labor is voluntary. This is labor activity for oneself, when the owner and worker act in one person. A typical example of such activity: entrepreneur, farmer, etc. If labor activity is hired, then the employer and employee are different people, their relationship is formalized by an employment contract, sometimes an agreement or contract, and based on the results of work, the employee receives a certain monetary reward.

Labor productivity is the ratio of the result of labor (the number of products produced) in a certain period of time. Labor productivity, in turn, depends on a number of factors that can affect it.

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What is labor as a factor of production?

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Labor as a factor of production

Work— it is a process of conscious expedient activity of people, aimed at creating the benefits they need.

The process of labor is associated with the expenditure of human energy, muscles, and intellect.

Such costs are considered by economic theory as the expenditure of human labor power. Under labor force refers to the ability of a person to work. physical and vocational ability. This means that in order to work, one must have certain health and professional knowledge and skills.

Labor power thus exists before the process of labor begins, which appears as a function of labor power. Since the labor force acts as labor in potential, it is considered as a labor resource.

Societywide labor resources represented by that part of the country's population that is capable of work, that is, has a labor force.

Labor as a factor of production has quantitative and qualitative characteristics.

Quantitative characteristics reflect labor costs determined by the number of employees, their working time and labor intensity, that is, the intensity of labor per unit of time.

Qualitative characteristics of labor reflect the skill level of employees. According to this level, there is a general division of workers into skilled, semi-skilled and unskilled.

TO qualified include workers whose training and preparation required a considerable amount of time, who have mastered a lot of information and are able to carry out labor operations that are complex, not only physically, but intellectually. This category primarily includes professional workers who are classified as employees in Russia: teachers, doctors, lawyers, economists, executives government agencies who have undergone a long general and vocational training and being carriers of significant information necessary for the implementation of complex work.

TO semi-skilled include workers whose training did not require a long time and who, having a limited amount of information, are able to perform labor operations of medium complexity.

unskilled consider workers who perform work that does not require special training. As a rule, training in the necessary labor operations and obtaining the information necessary for this occurs in the process of labor itself, such as, for example, the labor of diggers.

The qualification of workers is reflected in the degree of complexity of their work. Unskilled labor is considered simple, and skilled labor is considered complex, as if raised to the power of simple labor, or simple labor multiplied by the appropriate coefficient of complexity.

The considered characteristics of labor are closely related to each other, the shortcomings of some characteristics can be offset by the merits of others. For example, from the point of view of social production, incomplete

the employment of the working population can be compensated by increased working hours or the intensity of work of workers. The increase in labor intensity compensates for the shortening of the working day and

vice versa.

The ratio of the result of labor in the form of the number of products produced (P) to its costs per unit of time (Wt) characterizes labor productivity (Pt)

An increase in productivity allows for a given labor input per unit of time to produce more products. Labor productivity depends on a number of factors that can be divided into subjective and objective.

To subjective factors include everything that is directly connected with a person as a subject of labor. First of all, it's his qualification . Skilled labor creates more benefits per unit of time than unskilled labor.

Factors of production

Another factor is labor cooperation . plays an important role in ensuring labor productivity organization . The organization of labor must exclude unproductive expenditures of the efforts of employees, ensure a responsible attitude to work, and arouse interest among employees in the results of their work.

TO objective factors labor productivity include changes in the material factors of production - land and capital, acting as objects of labor. For example, replacing a less fertile plot of land with a more fertile one allows you to increase the yield with the same labor costs. Equipping workers with machines leads to an increase in production volumes even with a reduction in labor costs. Here we can see that the action of objective factors leads to the fact that they replace labor as a factor of production. In this case, the same patterns are manifested as in the case of land replacement. The replacement of labor by capital can cause an increase in the return on each additional unit of capital involved up to a certain point, after which the return begins to fall, that is, the effect of diminishing returns on capital as a factor of production comes into play.

It should be noted that subjective and objective factors affect labor productivity in close interaction with each other. Although, one can speak of pure performance determined only by subjective factors or only by real ones. In the first case, one has to say O productivity of labor , and in the second. O productive power of land or capital . But usually performance is determined simultaneously by several factors. So, if the enterprise old technology is replaced by a new one, these changes may not provide productivity growth unless there are corresponding changes in the labor for servicing the equipment. So productivity growth here is determined not only by capital, but also by labor.

The close relationship between labor and capital will be especially clearly seen in the subsequent consideration of capital as a factor of production.

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Labor as a factor of production

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Labor as a factor of production. The price of labor.

The labor market is a special area of market relations where transactions for the purchase and sale of labor force are made. It did not always exist and historically appeared on a mass scale only under the conditions of classical capitalism. Then, on the one hand, the main means of production were concentrated in the private property of businessmen, and on the other hand, the vast majority of workers were alienated from them. All employees became legally free persons, and the main, and even the only, source of their existence was the sale of their labor.

Work- this is the expedient activity of man, with the help of which he transforms nature and adapts it to meet his needs.1

There are many wage theories.

According to K. Marx, wage under capitalism, it is a converted form of the value of the commodity “labor power”, which is determined by the cost of the means of subsistence necessary for the normal reproduction of labor power (at the same time, labor power is understood as a person’s ability to work). Thus wages are the value of the worker's means of subsistence.

In contrast to capitalism, wages under socialism were interpreted as part of the country's national income, distributed among workers in the public sector of the economy in proportion to the quantity and quality of labor invested, i.e. wages are wages.

Modern economists in a narrow sense define wages as the price of labor, the income received by an employee for the provision of labor services per unit of time (hour, day, month). In a broad sense, it includes, in addition to wages, also income in the form of fees, bonuses and other types of remuneration for work.

Distinguish between nominal and real wages.

Under nominal wages is understood as the amount of money that a wage worker receives for his daily, weekly, monthly work. By the value of nominal wages, one can judge the level of earnings, income, but not the level of consumption and well-being of a person. To do this, you need to know what the real wage is.

Real wage- this is the mass of life's goods and services that can be purchased for the money received. It is directly dependent on the nominal salary and inversely on the level of prices for commodities and paid services.

Market factors significantly affect the amount of wages:

1) supply and demand in the labor market;

2) the form of competition.

The subjects of demand in the labor market are business and the state, and the subjects of supply are households.

The amount of remuneration for labor can change in a competitive market in accordance with the laws of supply and demand.

The demand for labor is inversely related to wages. With an increase in wages, ceteris paribus, the entrepreneur, in order to maintain equilibrium, must correspondingly reduce the demand for labor, and with a decrease in wages, the demand for labor increases.

Consider the process of establishing equilibrium in a competitive labor market using a graphical model (Fig. 7.1). Here on the abscissa is the amount of labor (Q), and on the ordinate - the wage rate (W).

The functional relationship between wages and labor demand is expressed in the labor demand curve (D). Each point on the demand curve for labor shows what demand will be at a certain wage. The configuration of the curve and its negative slope show that the lower the wage, the greater the demand for labor, and vice versa.

The situation is different with the labor supply function. It also depends on the size of wages, but this dependence is direct: the higher the wage, the greater the supply of labor, and vice versa. So the labor supply curve (S) has a positive slope.

Rice. 7.1. Equilibrium in the labor market

According to the American economist Paul Samuelson, the total supply of labor in a society is determined by at least four indicators: 1) the total population; 2) the share of the self-employed population in the total population; 3) the average number of hours worked by workers during the week and throughout the year; 4) the quality, quantity and qualification of the labor that the workers will expend.

Now let's connect these two graphs - the demand curve (D) and supply curve (S), which intersect at a point (e). This point on the graph corresponds to a certain equilibrium level of wages (We) and the labor supply given by this level (Qe).

At the point of balance (e) demand for labor equals supply. This means that all entrepreneurs who are willing to pay the equilibrium wage find the necessary amount of labor on the market, and workers who are willing to offer their services for this wage are fully employed. This state of the labor market corresponds to the situation of full employment.

Under any other conditions of wages other than We, the equilibrium in the market is disturbed and two situations arise:

a) if the salary (W 1) above the equilibrium, then there is an excess supply of labor, which leads to unemployment;

b) if the salary (W 2) below the equilibrium, then the demand for workers exceeds the supply and there are unfilled jobs.

Both of these situations in the market conditions perfect competition cannot be sustainable, they are subject to correction by market mechanisms in the direction of restoring full employment.

The most typical situation in the labor market is imperfect competition. It develops under the influence of the activities of trade unions, which are on the side of the supply of labor and affect wage rates, and entrepreneurs, influencing wage rates through the demand for labor. Trade unions, on the one hand, and entrepreneurs, on the other, create a double monopoly on the market. Some act as monopolists-sellers, while others act as monopolists-buyers. Both of these monopoly forces (seller and buyer) set the price. The form of harmonization of demand for labor and supply of labor in a market-type economy is the labor contract (agreement) between the employer of the labor force and the employee himself. It can be either individual or collective. Labor contracts:

1) serve as the main form of setting the price of labor (wages) in the labor market. This is their regulatory function at the microeconomic level;

2) perform a protective function, as they protect the socio-economic interests of employees;

3) collective agreements are an integral part of the national system of regulation of labor relations. This is their regulatory function at the macroeconomic level.

The state influences the level of wages by:

Establishing minimum wage rates;

Legal protection of employees and provision of certain guarantees to them;

Modifications of standard labor contracts and agreements in accordance with measures to combat inflation;

Limitations on the influence of trade unions.

V market economy Companies use two main forms of wages.

Time wage sets the amount of remuneration depending on the time worked. In this case, the amount of payment for 1 hour, day, week, month is calculated and multiplied by the time worked. In many countries, when setting time wages, a unit of measure for the price of labor is determined - the hourly wage rate, which can be calculated by dividing set value wages (for a certain period of time) for a normalized number of hours of work.

Time wages are usually used in enterprises where a strictly regulated technological regime prevails; it is used to pay businessmen.

For managers, engineering and technical workers and employees, scientific workers, time wages are established in the form official salaries – the size of the monthly salary, which corresponds to the official salary scheme and provides for its maximum and minimum limits (“fork”).

piece wages calculated according to the volume of output. With a piece wage, earnings increase in direct proportion to the number of manufactured products. This dependence is established using the piece rate. Prices are calculated on the basis of the hourly (or daily) price of labor and the normalized quantity of products that a person working with average intensity and average skill makes in an hour or day.

With piecework wages, a measure of the intensity of the worker's labor is established. This is done using production standards(a set volume of products to be manufactured by workers in a certain time) or norms of time(the reciprocal of the production rate is the time spent on the manufacture of a unit or batch of products). Such production norms are subject to payment in the prescribed manner. Self-interest motivates a person to work harder in order to produce more products and increase his income.

Piecework wages are widely used in enterprises where the share of manual labor is high and it is necessary to encourage an increase in the number of manufactured products. V modern conditions in piecework wages, factors such as product quality, equipment utilization, savings in raw materials and materials are increasingly taken into account, which brings piecework wages closer to time wages.

Currently, the material remuneration of employees is made dependent on the degree of achievement of the commercial results of the enterprise. There are widespread bonus systems that provide special rewards for high product quality, savings in materials and improving other end results of production. In various options, time-bonus, piece-bonus, piece-progressive, multifactorial and other types of wages are used.

Labor as a factor of production is very important and relevant, since it means the participation of a person in the production process, the use of his own energy and potential. The main elements of labor include objects of labor, means and purposeful human activity. The main results of labor: economic benefits, human development (physiological and mental), human living conditions, accumulation of knowledge and experience.

Labor is not just an engine of progress, labor is the basis of human existence and life, because under its influence the brain, speech develops, experience is accumulated, skills are improved.

Labor as a factor of production has content and character. According to the content, low-skilled, medium-skilled and highly skilled labor is distinguished.

In order to determine the nature of labor, it is necessary to conduct a thorough analysis of the combination of labor force and means of production, to clarify who and in what quantities appropriates the results of labor. With this in mind, three main social types of labor are distinguished: free, hired and forced. Forced labor is forced labor (slave labor). Currently, there are the first two types of labor activity.

Labor productivity is the ratio of the result of labor (the number of products produced) in a certain period of time. Labor productivity, in turn, depends on a number of factors that can affect it.

There are physical (material capital) and human capital. physical capital- non-expendable property (buildings, machines, equipment) used by the company in its activities. Distinguish between fixed and circulating physical capital. Main capital- real durable assets, the value of which is transferred to the product in installments over a number of periods of production (buildings, structures, machinery, equipment, vehicles, etc.). Working capital- real assets, the value of which is fully transferred to the cost of a new product and returned in cash to the entrepreneur when the product is sold in each cycle (raw materials, fuel, materials, semi-finished products). Human capital- the physical and mental abilities of a person obtained through education or practical experience; a measure of the ability to generate income embodied in a person. In other words, human capital is a special kind of labor resources. Therefore, capital in the market of factors of production means material factors, capital goods. Another aspect of capital is related to its monetary form. Money capital is the common denominator to which the value of capital in the form of any asset is reduced. In monetary terms, the value of both physical and human capital can be calculated. Capital embodied in the means of production is called real capital. money capital, or capital in cash, is an investment resource. By itself, money capital is not an economic resource; it cannot be used directly in production, but it can be used to purchase factors of production.

35. Entrepreneurship - a way of doing business on an independent basis.

The main functions of modern entrepreneurship are:

Financial and accounting management. Financial management involves the mobilization of capital, the accumulation of income from entrepreneurial activities, the management of the use of capital and income. The main task of entrepreneurship is to ensure the maximum return of entrepreneurial activity with minimal risk.

personnel function. Personnel management includes the selection of candidates and hiring, personnel management of the organization. Personnel management - a system of management activities in the field of social and labor relations of the organization's staff.

Competitive advantages of both the entire stratum and the individual enterprise today are largely determined by human resources. According to the calculations of the World bike, in the composition of the national wealth of the United States, the main production assets (buildings and structures, machinery and equipment) are only 1951, natural resources - 5%, human capital - 76%. In Western Europe, the corresponding figures are 23.2 and 74%. In Russia - 10, 40 and 50%. In addition, investments in human resources are growing, which makes the problem of their payback important.

Logistics. This activity covers operations for the acquisition of raw materials, machinery and equipment. The main task at this stage is the uninterrupted supply of production with the necessary resources at minimal cost.

production function. Production involves the transformation of raw materials, materials and semi-finished products into a finished product. Production management is associated with technical and technological aspects and is aimed at finding such a combination of factors of production that, with minimal production costs, would maximize profits.

Marketing involving the definition of consumer needs. Marketing is a system of accounting for consumer preferences and impact on the consumer, designed to ensure the sale of products on the market. At this stage, the task of the entrepreneur is to identify consumer preferences, and often the formation of new ones.

Research activities aimed at creating new technologies, updating the management system, developing and launching new products. In the age of the scientific and technological, and then the information revolution, scientific discoveries and their technological application play an increasingly important role and largely determine the position of an enterprise in the market, and, consequently, the amount of entrepreneurial income.

Public relations, implying the management of relations between the company and public structures (public authorities, consumer societies, trade unions, the media).

§ General price level: What is meant by the general price level? How do changes in the price level affect the state of the economy? What is inflation? Which inflation is good and which is bad?

§ Money circulation, interest rate level: What is the role of money in macroeconomics? What affects the general interest rate and what does it affect in the economy?

§ Trade balance: How does a country conduct international trade with other countries? How do changes in exports and imports affect the exchange rate, the development of the country in question, the state of the world economy?

fiscal policy

Main article: fiscal policy

Fiscal policy - the stabilization policy of the state in order to soften economic cycles by changing the parameters of total costs. The main instruments of this policy are net taxes and state procurements goods and services. If a country is in recession, the government can either increase purchases or cut taxes in order to increase aggregate output. If the economy rises or overheats, then, on the contrary, reduce purchases or increase taxes.

One of the many positive features of fiscal policy is that it is relatively easier for the government to carry out this policy than monetary policy, since the government does not make special, separate decisions for the implementation of fiscal policy. In addition, representatives of the Keynesian school suggested that when conducting monetary policy, it is easier to control the interest rate, but investment does not change much from this.

Fiscal policy also has its drawbacks. The state, like any other macroeconomic agent, can incur losses, that is, have a state budget deficit. A large stock of excess funds is also harmful to the state. Illiterate conduct of fiscal policy can turn into serious imbalance in the state budget. Economists call the main problem of fiscal policy Crowding-out effect (crowding effect) when, with an increase in government spending, due to a certain reaction in the market borrowed money, the volume of investments in the country decreases, which slows down the pace of development of the country.

monetary policy

Main article: Money-credit policy

Monetary policy - the stabilization policy of the state in order to soften economic cycles by changing the money supply by the Central Bank. To change the supply of money in circulation, the Central Bank can change the reserve requirement for commercial banks, operate on the open market, that is, sell or buy government bonds from the public, or print money.

The advantage of monetary policy is that banking system reacts faster to monetary policy than to fiscal. An stimulating monetary policy is also beneficial not only to the population, but also to commercial banks, since with an increase in the money supply, banks can issue more loans.

As a drawback of monetary policy, one can single out the fact that the change in the money supply depends not only on the Central Bank, but also on the rationality of commercial banks and the behavior of households, which often makes monetary policy longer in execution than fiscal.

39. Gross domestic product (Gross National Product) is the total market value of all final goods and services produced in the economy (domestic) in one year.
Let's analyze each word of this definition:

· Cumulative. GDP is an aggregate indicator that characterizes the total volume of production, total output.

· Market. Only official market transactions are included in the value of GDP, i.e. who went through the process of buying and selling and were officially registered. Therefore, GNP does not include:
a) work for oneself (a person builds a house for himself, knits a sweater, repairs an apartment, a master fixes a TV or a car for himself, a hairdresser does his hair);
b) work on a gratuitous basis (friendly help to a neighbor to fix a fence, to a friend to make repairs, to a friend to drive to the airport);
c) the cost of goods and services produced by the "shadow economy".
Although the sale of clandestine products is a market transaction, it is not officially registered or recorded. tax authorities. The volume of production of this "sector" of the economy in developed countries is from a third to a half of the total output. The shadow economy refers to those types of industries and activities that are not officially registered and are not taken into account by national statistical and tax authorities. Thus, the shadow economy includes not only illegal types of activity (drug business, underground dens and gambling houses), but also completely legal types, the profit from which, however, hides from paying taxes. There are no direct calculation methods for estimating the share of the shadow economy, and, as a rule, indirect methods are used, such as additional electricity consumption in excess of officially spent and additional money supply (amount of money) in circulation in excess of what is needed to service official transactions.

· Price. GDP measures total output in monetary terms, i.e. in value form, since otherwise it is impossible to add apples to sheepskin coats, cars, computers, CD players, Pepsi-Cola, etc. Money serves as a measure of the value of all goods, allowing to evaluate, measure the value of all various types of goods and services produced by the economy.

· Final. All products produced by the economy are divided into final and intermediate. Final products are products that go to final consumption and are not intended for further industrial processing or resale. Intermediate products go to a further production process or resale. As a rule, intermediate products include raw materials, materials, semi-finished products, etc. However, depending on the method of use, the same product can be both an intermediate product and a final product.

· Goods and services. Anything that is not a good or service is not included in GDP. Those payments that are not made in exchange for goods and services are not included in the value of GDP. Such payments include transfer payments and unproductive (financial) transactions. Transfer payments are divided into private and public and are like a gift. Private transfers include, first of all, payments that parents make to children; gifts that relatives make to each other, etc. Government transfers are payments made by the government to social security households and firms in the form of subsidies. Transfers are not included in the value of GDP: 1) because transfers do not pay for goods or services, i. as a result of this payment, there is no change in the value of GDP, i.e. nothing new is produced, and total income is only redistributed; 2) to avoid double counting, since transfer payments are included in the consumption expenditures of households (this is part of their disposable income) and in the investment expenditures of firms (as subsidies). Financial transactions include the purchase and sale of securities (stocks and bonds) on stock market. Since there is no payment for either goods or services behind a security, these transactions do not change the value of GDP and are the result of a redistribution of funds between economic agents. (It should be borne in mind that the payment of income on securities is necessarily included in the value of GDP, since it is a payment for an economic resource, i.e. factor income, part of national income).

· Produced in the economy (within the country). This statement is important in order to understand the difference between Gross Domestic Product (GDP) and Gross National Product (GNP). GNP is the total market value of all final goods and services produced by the citizens of the country with the help of what they own, i.e. national factors of production, whether in the territory of a given country or in other countries. When determining GDP, the criterion is the factor of nationality. And GDP is the total market value of all final goods and services produced in the territory of a given country, whether with the help of domestic or foreign factors of production. When determining GDP, the criterion is the territorial factor. In most developed countries, the difference between GDP and GNP does not exceed 1%. The difference between these indicators is significant for countries that receive high from the services they provide to citizens of other countries (for example, tourism services- Cyprus, Greece, Malta, etc. - or banking services - Luxembourg, Switzerland).

· Within one year. In accordance with this condition, all goods produced in previous years, decades, eras are not taken into account when calculating GDP, since they have already been taken into account in the value of GDP of the corresponding years. Therefore, to avoid double counting, only the value of a given year's output is included in GDP.