Division of Labor, Capitalist Economy and Efficient Production

Division ofLabor, Capitalist Economy and Efficient Production


Divisionof labor, Capitalist Economy and Efficient Production

Division oflabor is the process through which a work process is divided intovarious tasks which are executed by specific a specific individual orgroup of individuals (Sarokin,2015). Due to globalization, division of labor has been embraced byboth the public and private sector to promote production and increaseefficiency. A capitalist economy is a system of economy whereindustries trade and means of production are largely owned andmanaged privately. In such an economic system, the main focus isincreased production and improved efficiency to cut cost and maximizeprofit. In this paper, the importance of the division of labor in acapitalist economy will be discussed. The paper will also discuss howdivision of labor leads to efficient production and finally give someexamples of division of labor.

Divisionof labor is critical in a capitalist economy since it allowspecialization that leads to higher production. When an individualspecializes in a particular task, he acquires a higher level of skillthat leads to greater productivity and quality work. In a capitalisteconomy, specialization of labor plays an important role in promotingefficiency and higher productivity to reduce the cost of productionand maximize profit (Wadeson,2013). Capitalism normally creates an affinity for enhancedefficiency. Specialization of labor is therefore, a vital factor thatdrives any capitalistic economic system. Specialization of the taskcomes along with more awareness and higher responsibility amongemployee leading to increased production and good management of timeand resources.

Ina capitalist economy, division of labor makes it possible for massproduction. Large scale production is of great significance in acapitalist economy for the efficient use of resources such as rawmaterials, human resources, and tools. Division of labor enablesoptimum utilization of means of production, in the long run, reducingthe cost of production which is the main objective of many privateproducers and investors. Division of labor also increases the scopefor new inventions and innovations essential in a capitalist economyto enhance efficiency, reduce cost and improve production. Accordingto Sarokin(2015), division of labor is essential in a capitalist economicsystem since it creates a wider market. Division of labor comes alongwith cheaper and diverse goods resulting pinto higher demands forthese goods and services hence widening the markets.

Intoday’s economies, specialization of labor has become one of themain strategies being implemented by both the public as well asprivate sector to enable efficient production. According to Sarokin(2015), division of labor enables industries and businesses producegoods on a global scale and increase productivity. Division of laborallows an individual specialize in one particular task meaning thatsuch an individual becomes an expert in that particular task withtime. When a worker gains skills and expertise at executing aparticular task, he produces more within less time and less training. This is an indication that, specialization of labor gives rise toefficient production due to the fact that fewer resources are used,thus reducing the production cost. Division of labor boosts technicalefficiency through the reduction of transition time between varioustasks. For instance in car assembling industry, a worker who finishespainting a car does need to put down his painting tools and preparehimself to assemble the car since that job goes to anotherspecialized worker. Such a process takes less time and leads tomassive and efficient production.

Theoristssuch as Karl Marx have argued against Smith’s argument thatspecialization of labor leads to efficient production and lower costof production. Marx argues that specialization may lead to lowerproductivity since workers may lack the enthusiasm to work due torepetition and boredom with their specialized tasks(Wadeson,2013).However, Smith points that with specialized workforce needs lesstraining and consumes less time leading efficient production andlowered cost of production. The more specialized labor is the moreskilled and experienced it becomes leading to greater efficiency andenhanced production.

Itis clear that, it is possible to offer notable examples of divisionof labor as well as specialization. For instance in a car assemblingindustry where there exists a very high degree of specialization suchas testing, assembly and marketing among others. This highspecialization of tasks within this industry is the main reason itcan produce on a massive scale and become of the leading industry inthe world in terms of efficiency and quality production. Another goodexample of division of labor and specialization is found in thebanking industry. In this particular industry, there are peoplespecialized in front office tasks such as customer care,teller-related duties, account opening services. Others arespecialized in marketing and sales, others in loan services whileother are involved in the formulation of policies and human resourcemanagement.


Fromthe paper, it is clear that division of labor is highly important ina capitalist economy since it enables greater efficiency and enhancedproduction. Specialization of labor leads to a more skilled laborforce, which leads to reduced cost of production hence maximizationof profit. In today’s globalized economy, division of labor is ofgreat significance not only for greater efficiency but also massiveand quality production.

ReferencesSarokin,D. (2015).Howthe Specialization of Labor Can Lead to Increased Productivity.Accessed on 11thJune 2015 at:http://smallbusiness.chron.com/specialization-labor-can-lead-increased-productivity-12347.htmlWadeson,N. (2013). The Division of Labour under Uncertainty,&nbspJournalof Institutional and Theoretical Economics&nbsp(JITE),169(2), pp. 253–74