Role of Division of Labor in Economics

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Division of labor is the assignment of different parts of a manufacturing process or task to different people in order to improve efficiency (Lexico, 2020). This processed is used to produce a greater quantity of output by employees and businesses that can meet the demand for goods and services by creating a smoother flow and quicker productions rate. Division of labor is a way for businesses to be cost savvy and meet the demands for product.

So, the three I will feel aid in achieving this are:

  1. Specialized placement for employees giving a high degree of efficiency as the right man is put in the right job.
  2. Productivity is high and helps to lower cost for the business and a lower price for consumers.
  3. Can increase the dexterity, skill and creativity of employees to create more effective ways to get the job done.

Division of labor is essential to economic progress because it allows people to specialize in their task making production more efficient. Scarcity can cause the value of commodities to appreciate because the shortage makes the item look more attractive.

Businesses use tactics like Next Day Shipping, Sales Price Countdowns, Seasonal Offer, or Limited Stock to get consumers to buy to drive sales but if used to often it could lead to scaring away consumers. Scarcity can lead to trade offs by making an individual choose between the actual need and internal want for an item, deciding what is more important and what opportunity cost they are willing to pay. We have to do this with a lot of choose in our day to day life from the most simple (what to eat) to the hard ( finances), we have to make the trade off to get to the end goal we all internally have for ourselves. Microeconomics is the field of economics that looks at the economic behaviors of individuals, households and companies.

Macroeconomics takes a wider view and looks at the economies on a much larger scale – regional, national, continental or even global. There are different aspects of determining microeconomics and macroeconomics, they are interdependent to a large extent. A prime example of this interdependency is inflation (Investopedia, 2015).

Inflation and its implications for the cost of living are a common focus in the study of macroeconomics, but it can also have a small affect in price and cost to individual households and businesses, so it in turn effects microeconomics as well. In defining the list below some work Marco is a global scale of economical growth, and Micro is more of a localized economic growth. Some work with both because the need both globe and community to have proper growth.

Cite this paper

Role of Division of Labor in Economics. (2020, Nov 03). Retrieved from https://samploon.com/role-of-division-of-labor-in-economics/

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