In the great book Man, Economy, and State , Rothbard's vast compendium of economic wisdom, we read much that has not yet been properly popularized. Rothbard's production theory, for example, is quite different from the standard account. I have tried to distill this theory into the following synopsis, although it is by no means the only part of the book that warrants exposition.
Economics is about using our available means to achieve the best possible ends. Achieving an end is called consumption and applying a means towards an end is called production.
There are four broad categories of means, or factors of production, which are involved in achieving our ends. The first is labor, which refers to our own exertions, whether mental or physical. The second is land, which refers to any natural resource as it exists in nature. The third istime. At least a small amount of each of these is required in any production process.
Together, these three factors are called the original factors of production because they exist in nature prior to any human production. The fourth kind of factor is that which is produced, not because it directly brings satisfaction, but because it can be used in a different production process. The fourth factor is capital goods.
Since the time spent producing a good could have been consumed immediately as leisure, all production requires that one forgo present consumption for future consumption. In addition, one must have savings of some kind, enough to sustain one's self until the production is complete.
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