March 23, 2018 

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GREAT DEPRESSION: A period of time from 1929 to 1941 in which the economy experienced high rates of unemployment (averaging well over 10%), low production, and limited investment. This period of stagnation prompted radical changes in the way government viewed it's role in the economy and lead to our modern study of macroeconomics.

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The mobility, or movement, of factors of production from one type of productive activity to another type of productive activity. In particular, occupational mobility is the ease with which resources can change occupations. This is one of two types of mobility. The other is geographic mobility.
Occupational mobility is the ease of movement of resources between jobs. For example, a worker leaves a job as an accountant to takes a job as a computer programmer. Some factors are highly mobile and thus are easily switched. Other factors are highly immobile and not easily able to switch production activities.

To illustrate occupational mobility, consider the factors of production used by Hector Hamilton, a farmer residing on the outskirts of Shady Valley. Hector's key factors are farmland, capital equipment (especially a tractor and a big red barn), and assorted labor (including himself and a couple of hired hands). Hector also uses seeds, fertilizer, assorted chemicals, water, and electricity. How mobile are Hector's factors?

  • Land: The land used by Hector has relatively good occupational mobility. Hector could easily use this land to plant a wide range of crops. Or the land could be used to build a shopping mall or construct a factory. It could be flooded to create a recreational lake or be turned into a wildlife preserve. It could be used as the site of an amusement park or a drive-in movie. Hector's land is extremely mobile when it comes to changing production activities.

    Some of Hector's other land (material) inputs have very little occupational mobility, while others have extremely high occupational mobility. Water and electricity are obviously two inputs that can be used in almost any production activity, with correspondingly high occupational mobility. Seeds, in contrast, are designed to grow specific crops and have very limited occupational mobility. Fertilizers and chemicals, which could be used for different crops and which have limited non-farming uses, are slightly more occupationally mobile that seeds, but clearly not nearly as much as electricity and water.

    The space of land has a high degree of occupational mobility. It can be used for any number of different production alternatives. The materials of land, in contrast, haver differing degrees of occupational mobility. Some materials can be used in a wide range of production activities, while others are more limited.

  • Capital: Hector's capital is somewhat less occupationally mobile. The big red barn could, of course, be used in the production of a wide range of crops, but beyond farming the mobility lessens. It could be converted into living quarters, used as a tourist center for a wildlife preserve, or become the haunted house in an amusement park. Hector's tractor is also quite mobile between crops and it could be easily used to assist in other productive activities, perhaps as an amusement park ride.

    Capital has varying degrees of occupational mobility. Some buildings and equipment are specialized and others are more versatile.

  • Labor: Hector's workers have varying degrees of occupational mobility. Being young, single, and independently wealth, one of Hector's workers, Victor, is quite mobile between occupations. Victor could easily operate an amusement park ride, run a drive-in movie concession stand, or spend four years getting a degree in wildlife management.

    Hector's other worker, Becker, is little older, married to Hector's daughter, has three children in school, and is buying a parcel of farmland from Hector. Becker's occupational mobility is somewhat less than Victor. Becker could leave farming and pursue another occupation, but his marriage to Hector's daughter and his other ties to farming limit his occupational mobility.

    Labor also has varying degrees of occupational mobility. This mobility depends on specialization, which comes from training, experience, and human capital, as well as other factors, such as job tenure.

  • Entrepreneurship: Hector, as the owner/entrepreneur of the farm, is probably the least occupationally mobile of the three human resources. He is a farmer, he has been a farmer, he is not likely to leave farming to sell popcorn at a drive-in movie or operate the roller coaster ride at an amusement park.

    In general, entrepreneurship tends to be quite mobile between different production alternatives. If Hector had fewer ties to the farming occupation, he more could easily transfer his entrepreneurial ability to other production.


Recommended Citation:

OCCUPATIONAL MOBILITY, AmosWEB Encyclonomic WEB*pedia,, AmosWEB LLC, 2000-2018. [Accessed: March 23, 2018].

Check Out These Related Terms...

     | mobility | geographic mobility | factor supply curve | factor supply determinants | supply to a firm | supply by a firm |

Or For A Little Background...

     | factor supply | factors of production | factor market analysis | marginal factor cost | market supply | price elasticity of supply |

And For Further Study...

     | marginal revenue product | marginal physical product | factor demand | monopsony | bilateral monopoly | oligopsony | monopsonistic competition | market structures |

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