4.1.4.1 Production and productivity

higher productivity, workers develop expertise leading to better skills, saves time

Advantages of labour specialisation

boredom, lack of flexibility, de-skilling of workforce

Disadvantages of labour specialisation

repetitiveness could lead to less motivation and thus less productivity over time

Why does labour specialisation lead to boredom?

difficult to replace workers, slowing production or stopping it completely

Why does labour specialisation lead to lack of flexibility?

labour specialisation

workers focus on producing one good/service, rather than making everything they need themselves

people cannot survive on what they produce, exchange, barter

Labour specialisation increases productivity but it also means _________________________.

To get goods/services they must ________ what they make.

Without money this would require _______, which would be inefficient.

both sides must want what exactly the other has(“double coincidence of wants”)

Why is barter inefficient?

money

solves the “double coincidence of wants” by acting as a medium of exchange that everyone accepts.

Productivity

How much output(goods/services) we make from a given amount of input(resources)

Inputs

these are the factors of production

output

the goods/services produced

output / input

productivity formula

efficiently, more output

If we use our inputs more __________, we get ______ ______

[amount of output] per [input]

What unit of measurement do we use for productivity?

labour specialisation

each worker focuses on one specific task instead of doing many different jobs

division of labour

when work is split into smaller tasks, and different people do different parts

dividing work like this can make production much faster and more efficient

What did Adam Smit say about the division of labour?