changes in its price, is said to be immobile. It will be in inelastic supply in
any one use because even a large increase in the price offered will attract
only a small inflow from other uses. Generally, a factor is less mobile in
the short run than in the long run.
An important determinant of factor mobility is time: The longer the time interval, the easier it
is for a factor to convert from one use to another.Consider the factor mobility among particular uses for each of the three
key factors of production.
The Mobility of Capital
Some kinds of capital equipment—lathes, trucks, and computers, for
example—can be shifted readily among firms, among industries, and even
across different regions of the country. These are considered mobile
capital. Other kinds of capital are quite immobile. For example, some
plants and machinery are built for a specific purpose and are difficult, if
not impossible, to modify for other purposes. Equipment of this type is
immobile across uses, although it might be mobile in the sense that one
firm could sell it to another. Factories designed for a specific purpose are
immobile both across uses and across regions, though they could still be
transferred from one owner to another.
The Mobility of Land
Land, which is physically the least mobile of factors, is one of the most
mobile in an economic sense. Consider agricultural land. In a given year,