Land: Space to work within.
Labor: Human effort.
Capital:
Tools to make human effort
more fruitful.
How can an understanding of labor and capital be used to
better understand self-improvement? How can you better your lot in life by
contemplating them? I found the simple truth to be liberating.
In a business, for example a ditch digging company, capital
is often leveraged to get more value out of each unit of labor. Let’s look at an example that makes this
concept clear
Let each individual workers’ hour of labor be considered as
one unit of labor. Let’s also pretend that our company has one worker without
land or capital and is paid $50 dollars an hour for his services. In this
scenario, the worker uses his hands to dig the ditches. It goes without saying
that not much is being accomplished. To remedy this situation, the business
must invest in capital.
But wait, isn’t capital money? Yes, money is a type of
capital; it is a tool just like a shovel. But for some jobs, shovels are more
effective than money in the bank, and it makes sense to trade. Positioning
capital where it will leverage the laborer most effectively is the key to
success.
You are a business in and of yourself, a business with one
employee. A good way to improve a company with one employee is to make that
person more efficient, more highly skilled, and better equipped. Instead of
falling into a consumer mindset, remember that you are also a unit of
production. In short, invest in yourself. I hope to explore ways to do that in
this blog.
