5 - Specialisation And The Division Of Labour Flashcards
What is specialisation?
When an individual, firm or country concentrates on the production of a limited range of goods.
What is division of labour?
The specialisation of workers on specific tasks
What is productivity?
The effectiveness of productive effort
What is productivity measured in?
The rate of output per unit of input
What does increased productivity lead to?
Higher outputs
Higher quality
Higher living standards
More efficient use of resources
What are the advantages of the division of labour?
Workers become more skilled through repetition of tasks
Productivity of workers rises so output increases
Time is saved (focus on less tasks)
Easier and cheaper to train workers
What is the overall benefit for firms due to division of labour?
Higher quantity and quality of output
What is the overall benefit for workers due to division of labour?
Higher skills levels and potentially higher wages
What are the disadvantages of division of labour?
Repetition of tasks can lead to boredom
Simplified jobs can reduce pride
What is the overall benefit for countries due to division of labour?
Better quality and quantity of products
More efficient use of scarce resources
Higher trade
Higher economic growth and therefore higher living standards
What are the disadvantages of specialisation?
Over reliance is risky
Increased interdependence reduces self sufficiency
What are the two methods of trading?
Barter
Money
What is a medium of exchange?
Something commonly accepted in exchange for goods and services
What is a measure of value?
The price of a good shows it’s value
Allows it to be compared to other goods
(Money)
What is store of value?
When value is maintained and can be kept for a long time
