Economic Concept Of Land

Economic concept of land

Land means different things to different people, depending on their outlook and interest at a particular time. Whereas Henry George, sees land as the habitation of man, storehouse upon which he must draw for his needs, the material to which his labour must be applied for the supply of all his desires. On the land, we are born, from it we live, to it we also return. Take away from man all that belongs to land and he is but a disembodied spirit.

The above is a general view of land and in this respect also, land can be regarded as the as the solid partition of the earth’s surface. Also, land can be said to mean a nation, people or political division of the earth’s surface.

To lawyers and economists, land is considered as any portion of the earth’s surface over which ownership right can be exercised. Such right relates, not just to the surface area but also to things such as trees which are attached to the surface area, buildings and other improvements introduced by man, and to those objects of value, which is lie in, above or below the surface.

Concepts of land.

1. Land as space
2. Land as nature
3. Land as a factor of production
4. Land as a situation
5. Land as property
6. Land as consumption of goods and
7. Land as capital

Each of these seven sub components is discussed below.

1. Land as space: land can be viewed spatially, referring to such issues as a room, plot, allocation, or even the surface, which provide base and support for human activities. Land as space is fixed in quantity and is relatively indestructible. It is not limited to only the earth surface, the oceans, mountains, valley and plain, which provide physical support for man and his works, but also his cubic space.

2. Land as nature: land as nature is closely linked to land as man’s natural environment. This is highly conditioned by access sunlight, rainfall, wind, changing climatic conditions, soil, topographic conditions, natural forest and so on. It also deals with natural element of man’s environment, which, owing to past and present workings of nature, explains why some areas are rich in the forest, soil and other resources while others are not favoured.

3. Land as factor of production: economist usually refer to land as factor of production, just like labour and capital. In this sense land is seen as the nature given source of food, fibers, building materials, energy sources and other raw materials. This concept of land is closely related to the concept of land as a consumption of good.

4. Land as a situation: land as a situation is becoming more popular and important in the contemporary world. This is because it involves the relative location of land with respect to markets; geographic features and other resources in several parts of the world. Land as a situation is significant in many ways, chief of which is that the value and use of land is largely determined by its location.

5. Land as a property: this concept of land as property has the legal undertone. Issues such as areas over which individual, groups, or sovereign power exercise rights of ownership and use as well as the nature of the right and responsibilities they hold in land are primary focus under this framework. This is one of the most important concepts of land.

6. Land as consumption of goods: land is often required for direct use as building plots, parks and the likes. In this case it has value as a consumer’s goods in its own right, notwithstanding the fact that it might also be regarded as a factor of production as earlier discussed.

7. Land as capital: land is often seen as a capital item, particularly because it is considered as a key asset. Although, earliest economist see land as free gift of nature while capital is considered as man-made or that land is durable while capital tends to be expenditure.

Therefore, to an average investor, land must be purchased or leased, like other capital goods. In this sense, land is a capital item to the individual, even though it may be regarded differently by the society.

Special attributes of land
Land exhibits certain special features, which make it unique and therefore different from all other resources. In fact, the very special features of land, makes it a well-deserved recognition as a special branch of economics.

(a) Fixity of location: land fixity is also referred to as immobility or geographical non-transferability. This is one of the attributes of land that makes each plot or allotted space unique and or different from the next plot; you cannot move plot A to occupy the same location as plot B or vice versa. The physical position of each plot or even a town is fixed, as it were. Thus, if you have a plot of land in Ibadan, you cannot transfer it to Lagos if a need exist for it there.

(b) Limitation of Physical supply: the physical supply of land is the total land area available to a town or city, estate or a nation; whether such land is usable, used, unused or unusable. The portion of land that is currently usable, in the light of available technology and property institutions, constitute the economic supply. The physical supply cannot be increased by a centimeter, unless by conquest or annexation of a neighboring estate, town, city, state or nation.

(c) Heterogeneous nature of land: no two plots of land are exactly the same in all respects. They will exhibit a lot of variations in their physical features, which include shape, area, location, topography etc. Therefore, one plot cannot be a perfect replica of another, as may be the case with other capital goods.

(d) Durability or indestructibility of land: one distinguishing features that is durable and can rarely be destroyed. Thus once acquired, land lasts from one generation to other, unlike machinery and other capital goods have limited life span or useful economic life. Even, where there is a disaster such as fire outbreak, all other things can be destroyed, but land remains unaffected.

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