Adam Smith Flashcards
What is the division of labor?
Specialization of tasks; different people doing different things
What are the positive and negative effects of the division of labor?
Positive: improves skill through repetition, saves time (no task-switching), innovation through familiarity. Negative: stupidity due to loss of variety of tasks, experience.
What is universal opulence?
Wealth that extends to all
Where does universal opulence come from?
From division of labor, due to increases in productivity
Why does the division of labor emerge?
Due to human propensity to exchange, especially when combined with self-interest.
Where does the division of labor come from?
The market. Division of labor is limited by size and nature of market (small market, small division of labor, big market, big division of labor).
How does Smith understand differences between societies?
Through relative presence of division of labor (eg. human/animal, England/Poland, Europe/Africa).
How does Smith understand inequalities between individuals?
Roughly, individual inequalities result from division of labor, they do not cause it. Habit, custom, education -> DoL -> inequality.
What is the role of the state?
It protects private property and provides infrastructure and public education.
