Specialisation and Division of Labour

Question 1

What is specialisation?

Answer 1

This is the concentration of production on a narrow range of goods/services

Question 2

What are the advantages to specialisation?

Answer 2

1) Higher output. Resources will be focused on efficient production. There will be more trade and growth as a result.

2) Wider range of goods and services. EG: Samsung

3) Greater allocative efficiency. Resources will go to those who are most efficient at producing to maximise output

4) Higher productivity since workers are used better

Question 3

What are the disadvantages of specialisation?

Answer 3

1) Finite resources, especially for those who are very specialised.

2) Changes in fashion or trend

3) De-industrialisation. Other industries grow

Question 4

What is division of labour?

Answer 4

This is where the production process is broken down into separate tasks after specialisation

Question 5

What are the advantages of division of labour?

Answer 5

1) workers will be more productive due to the repetition. Higher productivity can lead to higher wages, time saving for firms, lower costs and prices.

2) Specialist capital for the workers can drive up productivity much more.

3) Lower prices and high quality and quantity

Question 6

What are the disadvantages of division of labour?

Answer 6

1) Demotivates workers. This reduces productivity. Too much repetition

2) Higher worker turnover. Workers may leave.

3) Risk of long term unemployment if these people are overspecialised. What if tech advances?