The main focus of Adam Smith's The Wealth of Nations lies in the concept of economic growth.

Growth,
according to Smith, is rooted in the increasing division of labor. This idea relates primarily to the
specialization of the labor force, essentially the breaking down of large jobs into many tiny components.
Under this regime each worker becomes an expert in one isolated area of production, thus increasing his
efficiency. The fact that laborers do not have to switch tasks during the day further saves time and
money. Of course, this is exactly what allowed Victorian factories to grow throughout the nineteenth
century. Assembly line technology made it necessary for a worker to focus his or her attention on one
small part of the production process. Surprisingly, Smith recognized the potential problems of this
development. He pointed out that forcing individuals to perform mundane and repetitious tasks would
lead to an ignorant, dissatisfied work force. For this reason he advanced the revolutionary belief that
governments had an obligation to provide education to workers. This sprung from the hope that
education could combat the deleterious effects of factory life. Division of labor also implies assigning
each worker to the job that suits him best. Productive labor, to Smith, fulfills two important
requirements. First, it must "lead to the production of tangible objects." Second, labor must "create a
surplus" which can be reinvested into production.

Another main concern for Smith involved tracing the roots of value. He identified two different kinds of
value, "use value" and "exchange value." The concept of exchange value interested Smith considerably.
The diamond-water paradox, in particular, proved puzzling to him: Why is it that diamonds, which have
very little practical use, command a higher price than water which is indispensable to life? By
discovering the true source of value Smith hoped to find a benchmark for measuring economic growth.
Eventually Smith settled on labor as the source of value: The number of hours labor that a good can be
exchanged for constitutes its inherent worth. (Note, this is not the same as saying that a good is worth
the number of hours spent in its production.) The value of a good can also be referred to as the "natural
price." The natural price need not function as the actual cost of a good in the marketplace. Competition,
however, was expected to push the market price towards the natural price.

Division of Labor:

Meaning and Definition:

"By division of labor is meant the specialization, of work. It refers to splitting up of a task into a number
of processes and sub-processes and carrying it out by a person or a group of persons who are best fitted
for it".

Definition by Adam Smith:

"The division of labor by reducing every man business to some one simple operation and by making this
operation the sole employment of his life necessarily increases very much the dexterity of the worker".

Division of labor may be simple, complex, or territorial. When different groups of people specialize in
different kinds of works, the division is said to be simple. For example, one man specializes in weaving
doth, the other in making shoes, still another in making implements for the agriculturist, etc.

Types and Examples:

Two types are given below:

(1) Complex Division of Labor:

When a particular work is split up into different processes and sub-processes and each process is carried
out by a single person or a group of persons, the division of labor is said to be complex. For example, in a
needle manufacturing industry, no one specializes in the making of a whole pin. The work is split up into
different processes and each worker is assigned a definite part in the whole work.

(2) Territorial Division of Labor:

When a certain locality specializes in the production of a particular commodity, the division of labor is
said to be territorial. For instance, Pakistan has specialized in the' manufacturing of sports goods,
Bangladesh in the production of Jute goods etc.

Advantages/Merits:

The system of division of labor has proved very beneficial to society. The main benefits arising out of
division of labor are briefly discussed as below:

(i) Increase in Productivity. Division of labor helps in bringing about a vast increase in productivity. This
fact can be better explained if we quote what Samuelson has said about it:
"Ten persons, however, were found to manufacture among them 48 thousand pins in a day or 4,800
pins per head per day. Individually and acting separately one man could scarcely have manufactured 20,
and may not perhaps even more than on a day. The efficiency was due, of course, in consequence of a
division and combination of different "operation".

(ii) Increase in Dexterity and Skill. Division of labor increases dexterity and skill of the workers. When a
person continuously works at one task for a longer time, he becomes expert of that task. Quoting
from Adam smith's Wealth of Nation:

"The division of labor by reducing every man business to some one simple operation and by making this
operation the sole employment of his life necessarily increases very much the dexterity of the worker".

(iii) Division of Labor stimulates Inventions. When a man is doing the same job over and over again, he
always keeps in mind as to how the work can be made easier. He sometimes succeeds in inventing
easier methods of production.

(iv) Diversity of Employment. Division of labor splits up one work into many parts. With the division of
work, the range of occupation increases. This gives opportunity to all types of workers such as young
man, women, aged people, children, crippled persons, etc., to get employment.

(v) Economy in the use of Machinery and Tools. When division of labor is introduced in a certain work,
there is a continuous use of machinery and tools and they do not remain ideal. For instance if a worker
is assigned the job of sewing shirts, he will be all the time in need of sewing machine and not complete
set of implements needed for sewing the clothes.

(vi) Saving in Time and Efforts. If a worker has to learn all the processes of producing a commodity, then
the period of apprenticeship will be fairly long. In case, the work is split up into small processes, the task
can be specialized in a short period and there can be much economy in time and efforts.

(vii) Large Scale Production at Cheaper Cost. Another advantage claimed by division of labor is that it
makes possible larger production at lesser cost.

(viii) Right man for the Right Job. Division of labor helps in bringing about the right man in the right
place. When there are too many jobs, every man tries to get himself absorbed in a work, where he
thinks himself to be best fitted. Thus, the chances of putting, square pegs in round holes are minimized.
(ix) Increased in the use of Machinery. As the work is split up into a number of processes, each process
of production becomes so simple and easy that it can be easily taken over by machines invented for that
particular process. It is in this way, we say, that division of labor leads to extensive use of machinery.

Disadvantages/Demerits:

Division of labor is not an unmixed blessing. It gives rise to certain disadvantages also. They are briefly
discussed below:

(i) Repetition Increases Monotony. When a worker has to perform the same work over and over again, it
creates sense of boredom in him. His individual incentive is curbed. It is in fact, a poor record of a man's
whole life never to have made more than 18th part of a pin.

(ii) Loss of Responsibility. Where a particular commodity is the Joint product of a number of workers
who are generally unknown to each other, they do not feel responsibility of their work. Moreover, the
workers do not feel pleasure and pride in it. The creative instinct of the workers thus slackens.

(iii) Risk of Unemployment. If a person specializes in a part of the job and totally depends upon it, then
he can always be in danger of unemployment.

(iv) Evils of Factory System. There is no doubt that division of labor involves production on a large scale
but the other side of the picture is that it brings over crowdedness, slums, immorality, loss of individual
freedom, strained relations of the employer and the employees, etc., along with it. These we all name as
the evils of factory system.

(v) Disruption of Family Life. Another evil which is associated with division of labor is that it bring
disruption, in family life. As division of labor provides opportunities for employment to women and
children, so, it results in the break up of the family life.

Conclusion:
If we carefully weigh the disadvantages associated with division of labor against its manifold advantages,
we will easily find that the advantages far outweigh the disadvantages. Most of the disadvantages can
be removed and minimized as they are actually removed and mitigated in advanced countries.

Division of labour is an economic concept which states that dividing the production process into
different stages enables workers to focus on specific tasks. If workers can concentrate on one small
aspect of production, this increases overall efficiency – so long as there are sufficient volume and
quantity produced.

This concept was popularised by Adam Smith in An Inquiry into the Nature and Causes of the Wealth of
Nations (1776). Famously, he used the example of a pin factory. Adam Smith noted how the efficiency of
production was vastly increased because workers were split up and given different roles.

Why is the division of labour more efficient?

Workers need less training as they only have to master a small number of tasks

It is faster to use one particular tool and do one job.

No time is wasted with a worker dropping a tool and then picking up another.

Workers can gain loyalty and a sense of achievement from their branch of the production.

There is no need to move around the factory; the half-finished good comes to him.

Workers can concentrate on those jobs which best suit their skills and temperament.

When production has very high volumes, the division of labour is necessary to get economies of scale.

Potential problems of division of labour

If workers are highly specialised, then the job can become very boring and repetitive. This can lead to
low labour morale.

If workers lose the motivation to concentrate and do a good job, mistakes may creep in as they get
bored.

An assembly line could grind to a halt if there is a blockage in one particular area.

Adam Smith himself recognised this potential problem and advocated education of the workforce so
that they wouldn’t get too demoralised by their repetitive job.

Examples of division of labour

Ford motor factories. In the 1920s, Henry Ford made use of the assembly line to increase the
productivity of producing motor cars. On the assembly line, there was division of labour with workers
concentrating on particular jobs.
Food production. A very basic example of division of labour could be seen in food gathering. In early
societies, men would be the hunters, women and children would prepare the food and collect berries.
The idea was that it was a very simple division of labour to enable the best use of different skill sets.

Nowadays, there is an even greater division of labour in food production. Farmers will buy seeds,
fertilisers and tractors from different companies. They will just concentrate on one aspect of food
production. The tools and food processing is handled by different workers and a different stage in the
production cycle.

Apple products. “Designed in California, produced in China”. A new iPhone has innumerable examples of
division of labour. The process is split up into many different parts. Design, hardware, software,
manufacture, marketing, production and assembly.

Globalisation and division of labour

Globalisation has enabled a division of labour by country. For example, the developing world
concentrates on the production of primary products. This involves low-paid labour to do the labour
intensive work of picking coffee beans. The beans are then transported to developed countries, where
other workers process, package and market the product