Explore the concept of division of labor

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Explore the concept of division of labor

Concept of Division of Labor

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The concept of division of labor includes dividing production process into a number of task where workers concentrate on specific task. This paper will address the importance of division of labor to the capitalist economy, how division of labor leads to more efficient production and finally provides examples of division of labor based on personal experiences. In a capitalist economy, division of labor ensures efficiency in production. Efficiency in production is achieved through placing each worker in a specific task which they are skilled in. Example of division of labor is in a restaurant and a shoe manufacturing company. Division of labor is very important as it ensures efficiency hence increasing productivity.

Division of Labor


Division of labor plays a very important role in maximizing efficiency in the manufacturing sector as well as economic sector. In economics, division of labor is defined as the separation of tasks into a number of tasks which are performed by specific specialized people in the task. The concept of division of labor is very important in the economic sector as it ensures efficient and effective delivery of services as well as production of goods. Division of labor is mostly done in large manufacturing industries where production is done on large scale. The production normally involves many workers and therefore division of labor is done perfectly by assigning each task to specific workers who are specialized in the area hence maximizing efficiency of production. Division of labor increases production, reduces production cost, saves time, ensures utilization of machinery and also ensures production of quality products.

Importance of division of labor to capitalist economy

In the current global economy, capitalism is the most well know economy. It is characterized by private ownership of means of production and property by companies and individuals. In this type of economy, the government has limited role to control and management making it a liberal economy where the free market determines demand, supply and pricing of commodities (Baumol & Blinder, 2015). Classic example of countries with capitalist economy is USA, Singapore and Germany among others. Division of labor has been highly used in capitalist economy where workers are assigned tasked in the area of specialization. Division of labor enables maximization of profit in a capitalist economy. Companies and investors transact in the economy with the motive of profit maximization and with the division of labor they are able to fully utilize resources to ensure maximum production of high quality products in the market. Another importance of division of labor is making companies competitive in the economy which reduces monopolies and therefore been the price setters in the economy with the sole purpose of making profit (Baumol & Blinder, 2015). Division of labor also ensures that the demand and supply in the economy is met as each worker in the production process focuses in the area they are specialized in making the production more efficient hence on time deliveries.

How division of labor leads to a more efficient economy

The division of labor in the production process of a company ensures that its divided into several tasks which enable workers to specialize in a specific task. Under division of labor tasks are allocated to workers according to their skills and capabilities which ensure efficiency as the right person is placed on the right task (Chandra, 2004). When workers focus in a particular part of the production process, efficiency is increased. Each worker knows their specific area where they perform best and therefore the production process becomes simpler providing efficiency in production. Efficiency is ensures as there is less time wasted as workers concentrate on specific area using specific tools within their area and no need to move around the plant looking for tools. There is also less training for workers as they concentrate on a specific area and concentrate on areas where they are skilled in. Division of labor in a manufacturing company subjects workers to repetition of a specific task which makes them become skilled in that area. They gain expert skills in that area which improves their efficiency hence increased productivity (Cowen & Tabarrok, 2015).

Examples of division of labor and specialization

In the modern world of business today, division of labor and specialization has been highly uses even in simple businesses. A personal experience of division of labor and specialization is in business like a restaurant. In the restaurant, several tasks are assigned to specific people who have the skills and capabilities to handle them. There is the chief chef, kitchen helpers, waiters, a greeter at the entrance to welcome customers, janitors for clean up, there is a manger for handling the paycheck and bills. Another example in a big business like manufacturing company dealing with production of shoes. The division of labor in the shoe factory involves the upper part of the shoes, bottom part, stitching and polishing and finishing where each part is done by a specific group of workers.


Division of labor has been very beneficial to the capitalist economy as it ensures efficient production and increases productivity. In a capitalist economy, manufactures wants to meet the demand and supply as well as set the price in the market which is ensured through efficient production. Division of labor ensures efficient production because with the right person at the right place of work resources are well utilized and output is increased.


Baumol, W. J., & Blinder, A. S. (2015). Microeconomics: Principles and policy. Nelson Education.

Chandra, R. (2004). Adam Smith, Allyn Young, and the division of labor. Journal of Economic Issues

Cowen, T., & Tabarrok, A. (2015). Modern principles of microeconomics. Macmillan International Higher Education.

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