Division of Labor• Dividing a huge task into

several smaller tasks• Increases

efficiency/productivity• Which is quicker… 1

person moving 30 desks across the room, or 30 people each moving 1 desk?

What are some more examples of division of

labor?

Division of Labor

Specialization

• Doing one task really well because it is done over and over

Specialization

• How do you think specialization increases efficiency and productivity?

Specialization• Specialization: people/companies learn

and practice a small set of skills then work or trade with others with different skills to produce something– Improves efficiency/productivity– The assembly line idea

Why does specialization work?

• Skills are developed at a deeper level– people become “experts” in their field

• Costs are cut because time needed to produce is decreased

• Training can be more focused and in-depth

Remember: People, Stores & industries specialize

Examples of specialization

• Doctors – cardiologists, dermatologists, dentists, podiatrists, rhinologists

Examples of specialization

• Teachers – grade level, subject, coaches

• Stores at the mall – food court, hats, electronics, shoes, clothes

• Write two examples of specialization in each of these areas:– Restaurant Movie Courts

How does specialization relate to voluntary exchange?

• Because we specialize, we rely on others for the things we don’t produce (CAUSE AND EFFECT!)

• In an exchange, BOTH sides are looking to gain something

• BOTH sides gain in VOLUNTARY, NON-FRAUDULENT EXCHANGE

How does each side gain in these potential transactions?

LAWYER

How does specialization increase efficiency and productivity?