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... bringing considerable profits to those who own it. Thus, property in the modern society has lost its basic economic tint and has acquired new meanings. In order to make property work better in the present day social situation, the variety of the property forms should surely be kept at its present level, with the development of new forms, which will ultimately result in the active differentiation of the entrepreneurial forms in society. Differentiation provision is one of the basic criteria for social decisions. (Fleurbaye, 2007) On the one hand, this variety is one of the best economic pathways towards differentiation of entrepreneurship; on the other hand, however, this may lead to the lower level of competitiveness it is suggested that with the increasing amount of entrepreneurial forms the number of entrepreneurs in each category will logically lessen, decreasing rivalry within each category, which is certainly undesirable for any market.
This is why such property variety and the differentiation of its economic concepts should also be controlled and analyzed as any economic notion. While property serves as one of the production factors, there are a number of other factors which should be looked at as important economic concepts, displaying their influence in the society today. Factors of production Households and enterprises activity is based on the use of production factors. These factors may briefly be described as the most important elements or objects which create decisive impact on the possibility and the results of entrepreneurial activity. While these factors are also under the influence of the basic economic laws (law of value, for example), they also refer to the deeper level of economic relations. (Weber, 2001) The increasing level of costs and the decrease of profitability of these resources are characteristics for the economic environment of the modern society.
It is expressed through the growing scarcity of basic resources. The growing prices for land, energy, raw materials and growing salaries in their combination create a complex influence on the ultimate price of goods, and the overall social situation. Scarcity of resources leads to changes in human behavior and entrepreneurial behavior of business in economics, urging them to look for the substitutes of the resources in order to decrease the cost of production. (Turnovsky & Garcia-Penaloza, 2006) On the basis of neoclassic economic theory which is included into the action of production factors, it becomes evident that four principal production factors find their place in society too. Land, capital, labor and entrepreneurship are acknowledged as the framework for market relations and their correlation with the human factor which serves the basic production factor. (Bergh & Hofkes, 1998) The expression of these concepts in society today may be somewhat changed under the impact of active technological development, but even in this area humanity is both the major social and market factor of production. This technological development is the result of the coordinated efforts of society which makes this development possible.
From the viewpoint of production, a person is not only a subject of production, but its ultimate goal. Any goods produced on the market should be consumed by human population. Satisfaction of the human needs and his development is natural ultimate goal of the social production, and this goal has been unchangeable during decades and centuries of human existence. While any entrepreneur strives for acquiring the higher profitability of his goods, this profitability is impossible without the goods being consumed by other people.
The concept of economic factors of production finds it display in society not only through the scarcity of resources, the issue of which one faces on a daily basis; this display is seen through the fact that factors of production do not attract due attention. The shift of accents towards social issues in the world has somewhat distracted some attention from the problem of proper use of production factors in the modern surroundings. (Bo, 2007) While much is said and written about each production factor separately, hardly any significant work has been performed in the area of production factors combination. (Braumwolle, 2007) The correct proportions of these resources will not only lead to the balance of market relations but will provide humanity with the more optimistic perspectives in relation to their use in the nearest future. This is why while the attitudes are changing towards the issue of resources and production factors scarcity; this line should not be lost. It is essential that the concept of production factors remains within the area of human attention in the next years and decades. The changes should be performed towards the complex (set) of production factors. (Braumwolle, 2007) The balance of this complex should be properly defined with relation to the existing social conditions.
The concept should be addressed more frequently. This set will also impact the differentiation of the social incomes, which represent another important economic conceit and is the most vividly displayed in society at present. Economic model of income inequality The principal factor, impacting the level of income in the society today is salary or the price of labor. The market system is the mechanism which does not work towards fair distribution of resources it is the very social system which re-distributes a certain part of income and profits which are acquired through the market mechanisms activity.
Market system is an individualistic structure and it allows the existence of such income inequality. Moreover, people possess different physical, mental and esthetic abilities. People are substantively different according to the level of their professional education and preparation. Any striving to eliminate the difference in incomes would mean the desire to eliminate the market mechanisms. (Turnovsky & Garcia-Penaloza, 2006) In the modern society the concept of income inequality carries very deep implication; on the one hand, it is considered in the form of in integral part of any market relations; on the other hand, it is understandable that in order to create stable peaceful social situation, certain efforts should be applied to perform re-distribution of the market activity results. This need is realized through the creation of the sophisticated system of social institutions aimed at supporting those layers of population which are incapable of providing themselves with the necessary finances for living; moreover, the principal goal of any social institution is not in financing those populations and societies, which cannot achieve significant social results, but in providing these societies with opportunities to develop, and giving them all necessary basis for such independent development. (Bergh & Hofkes, 1998) The changes which occur in the social environment on the basis of the income inequality economic concept are important to support the social equilibrium (Bo, 2007); it should be admitted that industrially developed states undertake significant efforts to provide their citizens with the maximal social benefits a state may offer; simultaneously, the payments in the form of taxes which income recipient makes into the state budget often grow together with the income increase. This progressive system is in no way aimed at eliminating the income differentiation.
It is only the instrument of creating the abovementioned social balance and the possibility for the state to be able to provide all population strata with the necessary social protection for the account of these finances. It is essential that social system exists together with the concept of income differentiation which will never lose its relevance. In relation to possible positive changes which can be taken on the basis of this concept is creation of the effective social systems in the countries where differentiation of incomes is too dramatic and is not properly addressed. (Bergh & Hofkes, 1998) It is also possible to suggest that while such income differences touch all countries of the world, and at global level countries represent peculiar subjects of the same differentiation a global social system of equal opportunities might be created. This social system should not be aimed at supporting separate states, as the number of organizations providing states in need with financial support is ample; such system should work for the benefit of population and will thus create solid basis of the social balance in the society.
Conclusion The number of economic concepts is so numerous, that it is difficult to choose those which display their effects most vividly. Obviously, each economic concept included into economic theory finds its expression and application in the present day social situation; these displays and effects are different. Far from all active concepts are under peer attention of governmental and market structures. This means that these categories are developing at random which does not positively influence overall society. We have here considered the concepts of property, law of value, social production, and income differentiation in conjunction with production factors. The complex of these concepts creates deep implications and irreversible effects in the whole market mechanism.
We have also discussed the possible changes which should be done in addressing each concept separately for the improvement of the social situation. The question remains, how these concepts should be addressed simultaneously; the fact that they constantly interact is doubtless. This is why it might be suggested to perform deep research in the area of complex interrelation of various economic concepts in the social sphere and the instruments (necessities) to regulate these concepts separately from the market mechanisms under impact of which they permanently exist. References Bergh, J.
C. van & Hofkes, M. W. (1998). Theory and implementation of economic models for sustainable development. Springer. Bo, P. (2007).
Social norms, cooperation and inequality. Economic Theory, 30 (1): 89 - 105 Braumwolle, Y. (2007). Public goods in networks. Journal of Economic Theory, 135 (1): 478 - 494 Brewer, R. & Music, J. (2001). Macro economics: A students guide to theory & concepts. Study mates Ltd.
Fleurbaye, M. (2007). Two criteria for social decisions. Journal of Economic Theory, 134 (1): 421 - 447 Turnovsky, S. & Garcia-Penaloza, C. (2006). Growth and income inequality: A canonical model. Economic Theory, 28 (1): 25 - 49 Weber, M. (2001). The e theory of economic and social organization.
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Research essay sample on Journal Of Economic Income Inequality
