The Marginal Productivity Approach in General
So far, we have applied the marginal productivity approach to analyze the demand for labor, in the Neoclassical tradition. However, the marginal productivity corresponds to the demand for any input. In general, we can define the - marginal productivity of any input as
- the additional output as a result of adding one unit more unit of that input, with all other inputs held steady.
In algebraic terms, that is approximately 
that is, the increase in output divided by the corresponding increase in the input, while the other inputs do not vary.
We can then define the value of the marginal product for any input as
VMPinput=p*MPinput
where p stands for the price of the output, as before. In general, we may think of the VMP as the marginal productivity of the input in money terms. The rule for maximization of profits, for each input, is to increase the use of the input until
VMPinput=priceinput
Now let's apply that to the land input.
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