Specialization Breaking Down

Specialization Breaking Down

Specialization, breaking down economic activity so that each factor of production may be devoted wholly to one part. Specialization of occupation is also referred to as division of labour. It makes possible fuller use of innate abilities, the acquisition of skill by training and practice, time-saving by providing continuity of work and the transfer of mechanical operations and routine controls to machines. Specialization of capital machinery and plant makes possible the use of equipment of at least minimum efficient scale. Specialization of land in particular uses enables advantage to be taken of least-cost locations for production.

All kinds of specialization illustrate the working of the principle of comparative advantage. Factors specialize not on the jobs at which they are absolutely best but on those for which they are relatively most efficient. Thus, a manager may be the best typist in the country, but he will leave his typing to his secretary and specialize on the tasks of co-ordination and control at which he is relatively even more efficient than his secretary. The land of Westminster may be better for wheat-growing than East Anglia but it is specialized in uses for which it has relatively larger advantage, e.g. office sites or Government buildings.

Specialization is not all gain. It implies co-operation between work-people and owners of factors of production, none of whom produce more than a tiny fraction of theft individual needs; therefore resources are required for tasks of organizing the co-operation. Secondly, the dependence of everyone on everyone else can make people vulnerable if the economic pricing system does not work smoothly. If individuals lack versatility .unemploymentmay result, while prices and wage rates are inflexible, if the demand for their speciality falls. Thirdly, it is argued that specialization stunts the development of character and reduces much work to stultifying monotony.

Specialization has engaged the attention of economists from the beginning of theft science, partly because it has been the essential source of the increase in the variety and quantity of goods produced, and partly because specialization necessitates exchange of products between specialists, and exchange has been one of the main subjects of study.

The degree of specialization depends upon the extent of the market; the inhabitants of the Isle of Man could not provide sufficient outlets for even one small works making washing-machines, but the population of Britain provides the opportunity for a number of works to specialize on different types of machine and components for them. Specialization can therefore be more intensive the larger the population, the closer they live together, the better the means of communication, the fewer the restraints on trade and the higher incomes are per head. Some economists see the process of economic growth as increase of specialization leading to higher output, increase of specialists' incomes, increased spending providing opportunities for further specialization and so on.

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