Division of Wealth and Labor

The distributed wealth among nations is never going to be the same and there are many factors that go into that wealth. One factor that economist and philosopher Adam Smith talks in An Inquiry into the Nature and Cause of Wealth of Nation about is the division of labor. Division of Labor is characterized as “Narrow specialization of tasks within a production process so that each worker can become a specialist in doing one thing”.[i] This concept of division of labor changed the way of thinking in terms of production due to the fact that manufacturing could be done all year, unlike agriculture.

Manufacturing is an all year around practice while the practices of agriculture can mostly be seasonal depending on locale. Nations that have more wealth than others weren’t necessarily ahead of other nations in agriculture but were further ahead in manufacturing and production due to the discrepancies in wealth among different nations. Transportation was also a big key those nations who had large manufacturing operations. In the beginning it was easier for cities closer to waterways to transport their product because it was easier to get the product from the manufacturer to the customer. The discrepancies in wealth among different nations can cause for loss of market share for certain nations that don’t have the money to compete with larger nations.

Division of labor is not only more efficient that one man doing all of the work, it allows for more creativity and innovation in whatever field the manufacturer is in. Division of labor is like an assembly line where each employee has one specific task to complete in the process of production. Innovation can be elicited from this concept of division of labor in the way that each employee has one specific task and they could find different tools or different methods to complete their task. Innovation can lead to being more productive if an employee can find a quicker way to produce their part of the product.

The wealthier you are as a nation the more you are going to prosper. This is the case for the nations who have a larger hand in manufacturing because it’s a more efficient way to produce a variety of products. This book birthed the mark of capitalism. In chapter one, it showed how manufacturing can be a weapon of capitalism and how nation can further increase their wealth.

[i] ((http://www.businessdictionary.com/definition/division-of-labor.html#ixzz3zigkaacd)

One thought on “Division of Wealth and Labor

  1. I like your support of transportation in regards to economic development. Too often do historians look at just the product and not enough from a business standpoint: how was the product marketed and delivered to customers? Countries like the United Kingdom or its colonies rely on the waterways to trade, but what about Europe’s internal trade? How do the conditions of road networks and the eventual development of the Steam Locomotive influence trade patterns and commerce (See the issue with All of Europe but Russia vs Russia in regards to railway gauges).

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