For whom to produce - This is the problem of distribution of goods and services produced among various people and factors of production in the economy. The production of goods and services is the result of combined effort of factors of production namely, land, labour, capital and entrepreneur. The output emerging from production is distributed in the form of money income i.e. rent, wages, interest and profit, on the basis of contribution of each individual factor of production. The economy needs to decide the best suitable mechanism for distribution - to reduce inequality of income, to reduce poverty , to add to the social welfare and standard of living of people.
