From Captain Capitalism:
If you recall high school economics or college freshman economics (both were the same, colleges just made you pay extra to re-learn what you did in high school) there were “The Factors of Production.”
These factors were essentially the ingredients you needed in order for a business or an individual to “produce” something. There were originally three of them.
Land – you can produce nothing without at minimum some kind of office space.
Labor – the machines will not only not take over the world, they’ll just sit there unless a human spends his or her time running them.
Capital – Nobody is doing nothing until they get paid. And that includes the people who produce the tools and machines you’ll need to get started.A fourth one was entered as they realized even with the above three, nothing would get produced. You needed a leader. An innovator. A man with the plan.
The entrepreneur.
Since there it was commonly accepted that there are three original, but most likely four real factors of production.
However, I would like to tender a fifth.
I’m doing this not to make things more complicated or to somehow be enshrined in the Economics Hall of Fame, but because our economy today practically proves there is a fifth and final factor of production that is required to produce, but is not accounted for in the current list. That fifth component is:
A future.
RTWT.
And then read my February 2009 post, Confidence.