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The size of a nation's income depends upon the quantity and quality of the factor endowments at its disposal. A nation will be rich if its endowments of natural resources are large, its people are skilled and it has a useful accumulation of capital assets. The following points are of interest:
1. Natural resources
These include the minerals of the earth, the timber, shrubs and pasturage available; the agricultural potential (fertile soil, regular rainfall, temperature or tropical climate; the fauna and flora; the fish, crustacean among others of the rivers and sea; the energy resources including oil, gas, hydro-electric, geothermal, wind and wave power.
2. Human resources
A country is likely to prosper if it has a large population; literate and numerate sophisticated and knowledgeable about wealth creating processes. It should be well educated and skilled with a nice mixture of theory and practice. The human resource of a nation should show enterprise, being inventive, energetic and determined in the pursuit of a better standard of living.
3. Capital resources
A country must create and then conserve capital resources. This includes not only tools, plant, machinery, factories, mines, domestic dwellings, schools, colleges among others but also a widespread infrastructure of roads, railways, airports and ports. Transport creates the utility of space. It makes remote resources accessible and high-cost goods into low-cost goods by opening up remote areas and bringing them into production.
4. Self-sufficiency
A nation cannot enjoy a large national income if its citizens are not mainly self- supporting. If majority of the enterprises are foreign-owned there will be a withdrawal of wealth on the form of profits or goods transferred to the investing nation.
Dullayo answered the question on May 10, 2018 at 09:46
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