Exploring economics: the secret life of t-shirts
Exploring economics: the secret life of t-shirts

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Exploring economics: the secret life of t-shirts

1.1.2 Labour intensive and capital intensive techniques of production

A good or service in question may be produced using a technique that employs mostly labour, referred to as a labour intensive technique, or a capital intensive technique, where machinery and technology are important.

Activity 3

Write down an example of a good you imagine being produced with a labour intensive technique, and a good you imagine produced with a capital intensive technique.

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Discussion

Fruit picking can be done using a labour intensive technique when the farm owner employs a large amount of seasonal workers to pick up the fruit. These days, fruit picking can also be done using machinery, which would be a capital intensive technique. Another example of capital intensive techniques are often found in car production.

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