Labor

In production, man needs to combine other factors (capital and land) with the expenditure of human energy, called labor.

Labor and leisure

In employing his labor, man takes into account which are the most valuable ends it can serve (as he does with all other factors). But he also weighs it against another consumers’ good: leisure. Leisure, like any other good, is subject to the law of marginal utility. The more a man labors, the less leisure he can enjoy.

The labor itself may provide positive satisfaction, dissatisfaction, or it may be neutral. In cases where the labor itself provides positive satisfactions, however, these are in­tertwined with and cannot be separated from the prospect of ob­taining the final product. Deprived of the final product, man will consider his labor senseless and useless, and the labor itself will no longer bring positive satisfactions.

An activity, which is engaged in purely for its own sake is not labor but pure play, a consumer good in itself. Play is subject to the law of marginal utility as are all goods, and the time spent in play will be balanced against the utility to be de­rived from other obtainable goods.

Division of Labor

In order to exchange, each party must have different goods in relation to their wants, and must be relatively specialized in the acquisition of different goods. This specialization by each individual may have occurred for any of following reasons: (a) differences in suitability and yield of the nature-given factors; (b) differences in given capital and durable consumers' goods; and (c) differences in skill and in the desirability of dif­ferent types of labor.

Exchange, a productive process for both par­ticipants, implies specialization of production, or division of la­bor.

External links

• Labor on Wikipedia