Division Of Labour, Specialization And Scale Of Production

Table Of Content

1. Division Of Labour
2. Specialisation
3. Types of Specialisation And Division Of Labour
4. Advantages Of Division Of Labour And Specialisation
5. Disadvantages Of Division Of Labour And Specialisation
6. Limitations To Division Of Labour And Specialisation
7. Economic Of Scale Or Scale Production
8. Types Of Economic Of Scale
9. Internal Economics And Internal Diseconomies
10. External Economies And External Diseconomies

Division Of Labour: Division of labour is defined as the breaking down of a production process into a number of separate operations whereby each operation is undertaken or performed by one person or a group of persons. Division of labour is a complex process mainly practiced in industrialized communities where a worker specialises in the production of a small portion of a product and he may not see the end product and may not make use of it. Division of labour for example is it in the publishing industry where each worker or group of workers or individuals are involved in writing of manuscript, typing of manuscript, editing, filming and plating, printing, folding, collating, sewing, binding and finally trimming. It is the joint effort of all this group of workers that enables a complete book to be produced.

Specialisation: Specialisation is defined as the concentration of the productive effort of an individual, a firm or a country in a given aspect of economic activity or on a particular line of production in which has the greatest advantage over others. Specialisation is the performance of a single job or economic activity in which an individual, firm or country has comparative advantage.

Division of labour is one aspect of specialisation. Specialisation is a result of division of labour.

Types Of Specialisation And Division Of Labour

1. Specialisation By Process: This is the type of specialisation in which a production process is divided into different operations or stages and which worker, or firm all country now concentrate on only one operation or stage. For example, a firm – a printing company – may concentrate on the printing stage or aspect of a publishing outfit.

2. Specialisation By Product: This is the type of specialisation in which a producer concentrates on the production of a particular commodity. For example, a firm milk concentrate on the production of malt drink and an individual farmer can concentrate on the production of poultry eggs.

3. Geographical Or Territorial Specialisation: This is the type of specialisation in which certain geographical region or 33 specialises in the production of a particular commodity. This specialisation is made possible in this region as a result of the type of climate and natural resources available in the area. For example, the presence of petroleum in niger Delta region enables the area to specialise in the drilling of petroleum.

Advantages Of Division Of Labour And Specialisation

1. Increase In Production: Division of labour and specialisation lead to increase in production because the various expert along the production process work together to boost greater production.

2. Time-saving: Division of labour helps to save time that would have been wasted in moving from one operation to another.

3. Development Of Greater Skill: Division of labour and label each worker to develop greater skill through repetition of the same process.

4. Large-Scale Production: Division of labour and specialisation lead to large production goods or products.

5. Lower Unit Cost: Six division of labour leads to greater productivity, that is, large quantities are produced and in less time, the unit cost of the product will be less.

Disadvantages Of Division Of Labour And Specialisation

1. Monotony or repetition colon in division of labour, a worker performs the same job on a daily basis the job therefore becomes monotonous and boring to him and this may lead to loss of interest in the job being done.

2. Decline In Craftsmanship: As a result of the use of machines in division of labour, people no longer make use of their skill in the production of goods, rather they become machine minded.

3. Reduction In Employment Opportunities: In division of labour, machines are usually used with few workers. This tends to reduce the level of employment among the workers.

4. Problem Of Mobility Of Labour: Under division of labour, a worker stays on a single job for a long time and this messy difficult for him to move to other jobs.

5. Problems From Increased Independence: Division of labour has meant that workers and Industries will have to depend on one another before production can take place. Absence of such a worker or industry may result in the closure of the entire production.

Limitations To Division Of Labour And Specialisation

Many factors limit the importance of division of labour and specialisation. These factors may either encourage or discourage the division of labour depending on whether they are favorable or unfavorable.

1. The Size Of The Market: If the size of the market is large and it can absorb all the quantities of goods produced, division of labour is favoured. But in a situation where the market is small, division of labour is not encouraged.

2. The Nature Of The Product: Products that can be broken down into stages will require division of labour Warehouse products that cannot be broken down into stages example driving, barbing, hairdressing tend to limit the importance of division of labour in production.

3. Level Of Technology: The level of technology set a limit to the extent of specialisation. New technological breakthrough may allow further specialisation and division of labour.

4. Availability Of Capital: Capital must be available in sufficient quantity to enable adequate payment of salaries and wages to workers and other materials to be purchased.

5. Availability Of Labour: The availability of qualified workers determining the stages in which production process will be divided.

6. Government Policy: Certain government policies can determine whether division of labour can operate or not. We are government policy favours large-scale production, division of labour is bound to operate.

7. Development Of Commercial Sector: A well-developed commercial sector the man’s high volume of products and such high volume of products can only be made through the adoption of division of labour.

Economics Of Scale Or Scale Of Production: Economies of scale can be defined as the growth of a firm as a result of the expansion of the volume of productive capacity resulting in the increase in output and a decrease in each cost of production per unit of output.

Types Of Economies of Scale:

There are two major types of economies of scale. These are:

i. Internal economies and internal diseconomies.
ii. External economies and external diseconomies.

Internal Economies And Internal Diseconomies: Internal economics, also popularly known as the economics of large-scale production, is defined as the advantage which a firm derive or obtain as a result of its increase in size or expansion of its output. As the size of the firm increases or expand, this will lead to greater efficiency and a resultant for in the cost per unit of output. Shut up disadvantages being enjoyed by this firm could come from financial, managerial, all technical large scale production which take place within the firm.

Internal diseconomies on the other hand can be defined as the advantages which a firm undergoes as a result of expansion, resulting in less efficiency and increase in the cost per unit of output as a result of managerial problems.

External Economies And External Diseconomies: External economies economics are benefits a firm der
ives from concentration all localisation of industries in a particular area. In other words, these are the benefits a firm enjoys from increase in output and decrease in cost as a result of the kind of assistance it derives from the other firms within the same location. External economies are mostly derived from Industrial Estate where there are many firms operating in the same location.

External diseconomies on the other hand refers to the disadvantages a firm experiences when the activities of one Omo Industries increase the cost of production or output of that firm within the same location.