Factor Demand Function

A Factor Demand Function id a relationship function between the price to a factor of production and quantity of the factor demanded (holding all ceteris paribus factor demand determinants constant).

• Example(s):
  • a Labor Demand Curve.
  • a Capital Demand Curve.
  • an Entrepreneurship Demand Curve.
  • a Real-Estate Demand Curve.
  • …
• Counter-Example(s):
  • an Elasticity Function.
• See: Factor Demand, Factor Market, Factor Price, Perfect Competition, Monopsony.

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References

2013

• http://www.amosweb.com/cgi-bin/awb_nav.pl?s=wpd&c=dsp&k=factor+demand+curve
  • QUOTE: A graphical representation of the relationship between the price to a factor of production and quantity of the factor demanded, holding all ceteris paribus factor demand determinants constant. The factor demand curve is one half of the factor market. The other half is factor supply. The factor demand curve indicates the quantity of a factor that would be demanded at alternative factor prices. While all factors of production, or scarce resources, including labor, capital, land, and entrepreneurship, have factor demand curves, labor is the factor most often analyzed. Like other demand curves, the factor demand curve is negatively sloped. Higher factor prices are associated with smaller quantities demanded and lower factor prices go with larger quantities demanded.

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