- [Instructor] All of economics is based
on this notion of scarcity of resources.
What does scarcity mean?
Well, in an everyday context, it means
that there's not as much of something,
say, a resource, as people may need
or there's not an unlimited amount of something.
So not unlimited
unlimited amount
of a resource or resources.
Resource, and I'll put a little,
resource or resources.
And the common examples, especially
in an academic economics class,
when people are talking about scarcity,
the resource they're talking about,
they'll often say land.
And by saying land, they're speaking generally
of natural resources.
And so, examples of this would be things like energy.
It could even be things like water.
It could be lumber.
It could be minerals, maybe some type of metal.
Obviously, it could be land itself.
And you could see some of that depicted
in a picture like this.
Clearly, there's land here and you can even argue
maybe, even the solar energy that it has access to,
that these would all be broadly put into this category.
Now another type of natural resource
that is often talked about in an economics class
will be labor.
And labor we associate with people working
and that is what labor is making reference to.
It's all about work effort.
And we talk about work effort,
we're talking about the workers
and how much they're working, so hours of labor.
Hours of labor.
And this picture right over here
is a clear picture of some workers.
Now, another resource that you'll often talk about
in the context of scarcity is capital.
And capital can be a little bit confusing at first.
Well, it's things that people make
in order to make other things.
So things
made to make
other things.
And so just to hit the point home here, pause this video.
In these pictures, what capital do you actually see?
Well, there's actually a bunch of capital
in these pictures.
There's some of the obvious things like these tools,
this would be a clear example of capital.
Even these buildings, these buildings are used
to maybe store animals or crops.
So these are things that someone made
in order to help make other things.
And some of maybe, the less obvious things
you might not even notice it at first
but there's these power lines here.
Someone made this in order to help us distribute energy
which could be used to make other things.
So that too could be used,
that could be an example of capital here.
Now the fourth resource that you'll hear folks talk about
is really thinking about well how do we know
how to combine these first three types of resources
and we could call that entrepreneurship.
Entrepreneurship.
Sometimes people will refer to technology
but this is all how to combine,
how to combine
all of the above right over here,
one through three, these types
of resources right over here.
Someone had to decide that hey these were good places
to put these storage houses.
Someone had to decide where to put the power lines.
Someone had to decide what crops to plant here
and how to plant them.
Someone had to decide, well, what type of labor
do we need, what type of land,
what type of capital, the actual factory building,
the factory equipment do we need
in order to produce whatever these folks
are producing right over here.
And that general notion,
you could talk about as entrepreneurship.
And so the big picture here
is think about the world around you.
There's not an unlimited amount of land,
especially if you're thinking about land
for a specific purpose.
There's not an unlimited amount of natural resources,
energy, lumber, some type of metal,
there's not an unlimited amount of labor,
there's only so many people who exist,
and there's not an unlimited amount of capital,
we don't have an infinite number of buildings
or equipment, and we don't have
an infinite amount of entrepreneurship,
we can only have so much energy
to think about how do we put these other things together.
So I will leave you there
and as we go further in our quest in economics,
we're gonna see the scarcity of these four resources
show up over and over again.