ABSTRACT
I t has traditionally been supposed that conditions of supply give a more substantial and empirically significant basis for distinguishing among factors of production in specific terms. The classical economists distin guished three main factors of production: land, capital, and labor. Land they regarded as a permanent, nonreproducible resource fixed in amount, the supply of which was therefore perfectly inelastic to the economy as a whole. Capital they regarded as a reproducible resource, the amount of which could be altered through deliberate productive action, so its supply was not perfectly inelastic. Indeed, in the main, they tended to regard i t as highly elastic. Labor, like capital, they regarded as reproducible and ex pansible, and, indeed, as supplied to the economy in the long-run at con-
stant cost, yet to be distinguished from capital because of its dual status as a productive resource and an ultimate consumer.
