Organization of Production

There are four requirements called the factors of production, to produce goods and services. 

1. Land: Natural resources like water, forests, minerals, land, etc.
2. Labor: Some activities require manual labor, while others are highly qualified.
3. Physical Capital: Fixed Capital and Working Capital.
4. Human Capital: The skill and knowledge to put together the factors of production (land, labor, and physical capital) and produce an output to sell in the market is called human capital.

The Story of Village Palampur is a narrative that introduces basic concepts of the production activities of a hypothetical village called Palampur. The hypothetical village is based on a research study of a village in Western Uttar Pradesh in the Bulandshahr district by Gilbert Etienne.

Palampur is well-connected with neighboring villages and towns. Many kinds of transport are available on the road that connects the nearby village Raiganj and the town Shahpur. Palampur has a primary health center run by the government one private dispensary, one high school, and two primary schools. This village has 450 families belonging to different castes. The majority of the land in the village is owned by upper-caste families. The SCs (Dalits) comprise one-third of the population. Most households have electric connections. Tube wells in the fields are powered by electricity and are used in various types of small businesses.