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Labor

Definition

Labor refers to the human effort, both physical and mental, that is used in the production process. It includes all types of work performed by individuals, from manual laborers to skilled professionals.

Analogy

Imagine labor as a team of workers building a house. Each worker has their own role and contributes their skills and efforts towards completing the construction. Similarly, in production processes, labor involves people working together using their abilities to produce goods and services.

Related terms

Wage: Wage is the payment received by workers in exchange for their labor.

Human Capital: Human capital refers to the knowledge, skills, education, training, and experience possessed by individuals which enhance their productivity.

Division of Labor: Division of labor is when tasks are divided among workers based on specialization or expertise to increase efficiency.